How Ecommerce Brands Can Tackle the $816B Returns Problem?

It’s safe to assume that every ecommerce leader knows very well that returns are the ugly side of online shopping. 

And when you’re selling internationally? It’s chaos squared.

In 2022, global ecommerce returns cost the industry $816 billion. And if this trend sticks, this figure could reach $1.4 trillion by 2027.

Now add the complexity of international markets—customs, logistics, cultural differences—and you have a recipe for headaches, higher costs, and frustrated customers.

But what if you could flip the script? What if returns can be looked at from the perspective of an opportunity to boost customer loyalty, control costs, and stand out in global markets? 

Spoiler alert: you can.

What you’ll learn

• Why effective international returns management matters
• Challenges in cross-border returns management
• Best practices for international returns management
• The role of reverse logistics in cross-border returns
• How you can simplify international returns management

Why Effective International Returns Management Matters

Though commonly perceived as a logistical headache, returns are also a critical customer touchpoint. Shoppers expect convenience, and they want it for free. 

As per a recent study, 72% of customers believe online orders should always be returnable at no cost, and 27% abandon their carts if the return process seems unclear or complicated.

Interestingly, when returns are handled well, the payoff is undeniably huge: 96% of customers say they’d shop again with a retailer offering an easy return experience. 

So if you’re looking to expand internationally, mastering this is sacrosanct.

Challenges in Cross-Border Returns Management

Handling returns is rarely straightforward, and when it comes to international orders, the complexity only grows. For shoppers, the expectation is simple: returns should be easy, fast, and free. But for merchants, managing returns across borders presents a range of logistical and operational hurdles that can quickly escalate costs and strain resources.

Typically, here’s what you’re up against when you’re dealing with international returns:

• Sky-high logistics costs: International returns often incur higher shipping expenses due to extended distances and the need for specialized handling. In some cases, the cost of processing a return can surpass the item's original value, making it economically unfeasible to accept returns.
• Customs & Duties Complications: Returns require navigating varied customs procedures, including duties, taxes, and documentation. Missteps can lead to costly delays, fines, or even confiscation of goods.
• Cultural differences: Shoppers in different regions have varying attitudes toward returns. For instance, European customers expect free, fast returns as standard, while buyers in Asia or South America may be accustomed to stricter policies.
• Time delays: Long return timelines can leave customers hanging, hurting your brand’s reputation.

Notably, clothing return rates sit at a whopping 56%, making it the most returned category in ecommerce. 

If you’re selling internationally, you can’t afford to wing this.

Best Practices for International Returns Management

So, what sets the brands that handle international returns well apart? They create a process that works smoothly for customers and is efficient for their business, turning something tricky into a positive experience for everyone involved.

In short, they don’t just “handle” returns—they optimize them. 

Here’s how you can do it too:

• Localize your return policies: Speak your customers’ language—literally. Make policies clear, transparent, and aligned with regional norms.
• Use regional return hubs: Shipping returns to a nearby hub cuts costs and speeds up refunds.
• Leverage tech to track and automate: Nobody likes waiting for answers. Tools that provide real-time tracking and automated refunds save everyone time (and frustration).
• Make sustainability part of your strategy: Packaging designed for reuse or recycling can reduce your environmental impact and appeal to eco-conscious customers.

The Role of Reverse Logistics in Cross-Border Returns

Reverse logistics is the process of managing product returns and ensuring they are resold, restocked, or disposed of in the most cost-effective way. Reverse logistics is the process of managing product returns and ensuring they are resold, restocked, or disposed of in the most cost-effective way.

The degree to which you handle your reverse logistics is pretty much what separates a nightmare return process from a hassle-free one. 

Here’s the recipe for success:

• Regional return hubs: Positioning return hubs closer to customers drastically reduces shipping expenses while cutting refund timelines. Instead of dealing with lengthy international shipments back to a central location, businesses can process returns locally, delivering faster resolutions that align with customer expectations for seamless service.
• Tax and duty recovery systems: Unrecovered taxes and duties eat into margins with every return. Implementing systems to recover these costs ensures compliance with global trade laws and minimizes revenue leakage. For example, VAT refunds on EU returns are an opportunity for businesses to offset costs, but only if the right recovery processes are in place
• Data-driven insights: Your return data is a goldmine of actionable insights. Are sizing issues driving returns? Are specific product descriptions leading to customer dissatisfaction? Dive into the patterns and use that information to refine product details, improve quality control, or adjust sizing charts.

How You Can Simplify International Returns Management

The good news is that you can partner with OpenBorder and streamline your global returns:

• Localized hubs: Customers can return items to nearby centers, saving time and money.
• Customs and tax compliance: We handle the messy details so you don’t have to.
• Tech that works: From tracking to refunds, OpenBorder simplifies every step of the returns process.

Turning Your Achilles’ Heel into Your Secret Weapon - Getting International Returns Right

There’s no denying that returns can be painful. 

But it doesn't have to destroy your margins or your customer relationships. The brands that win globally are the ones that see returns as more than a process to “manage.” They see them as an opportunity to build trust, retain customers, and create efficiencies.

And it’s not rocket science. 

• By leveraging regional hubs, you can lower costs by shipping returns to local facilities and consolidating bulk shipments back to your warehouse. 
• By allowing your customers to initiate returns domestically, you’ll save time and ensure a smoother, more reliable experience. 
• Plus, with smart workflows like storing returned inventory in-region, you can ship items back out quickly, cutting return postage costs and speeding up resale opportunities.

Think about it - when $1.4 trillion in returns is on the line, brands that get it right won’t just survive—they’ll thrive.

Ready to turn your returns strategy into your next growth driver? Get in touch with us.