The Incentivized Waste of Free Returns

Amanda Mull, the Atlantic:

It sounds harmful and inefficient — all the box trucks and tractor trailers and cargo planes and container ships set in motion to deal with changed minds or misleading product descriptions, to say nothing of the physical waste of the products themselves, and the waste created to manufacture things that will never be used. That’s because it is harmful and inefficient. Retailers of all kinds have always had to deal with returns, but processing this much miscellaneous, maybe-used, maybe-useless stuff is an invention of the past 15 years of American consumerism. In a race to acquire new customers and retain them at any cost, retailers have taught shoppers to behave in ways that are bad for virtually all involved.

The supposedly efficient marketplace has produced a system where the cost of production has decreased so much — through deliberately seeking the lowest-wage factory workers and taking a hands-off approach to their safety — that it is trivial for some retailers to discard huge amounts of merchandise from returns and overstock. The incentives are all backwards.