Ecommerce returns in Germany: the state of play in 2024 and future outlook

Returns are one of the biggest challenges in ecommerce. But let's be honest: as an online retailer, they will always be on your to-do list, so why not use them to your advantage? In this article, we show you how to stay one step ahead of your competitors when it comes to returns management. You'll get an insight into the current state of ecommerce returns in Germany, interesting facts about returns statistics and returns logistics. We also give you an outlook on how returns will develop in the future.

Returns in ecommerce: a necessary evil or an advantage?

To use returns to your advantage, you should stay up to date with the latest developments.

Make sure you know customer expectations as well as the latest technologies and tools. They let you optimize your returns process and give you valuable insights into the behavior of your target audience.

We look at how to best understand your customers' needs and meet their expectations. We also explore how you can offer your target audience a unique experience with returns services and policies.

All while making sure your business stays efficient, profitable and sustainable.

Here's what we'll cover:

• Returns in Germany: the current state

• Current best practices

• The best options for efficient returns

• How will ecommerce returns develop in the (near) future?

• Getting returns under control: innovative market developments

• How to avoid returns headaches

Grab your favorite refreshing drink and let's get started!

Returns in Germany: the current state

New technologies, changing customer behavior, the impact of the pandemic, new customs and fee regulations: as an online retailer, you have a lot to keep an eye on!

Here are the current developments and trends in returns, so you can keep your finger on the pulse.

• The returns rate is rising. According to Statista , more than 530 million parcels were returned in Germany in 2021. This trend is reflected in our Ecommerce Delivery Compass 2023 : in Europe, more than half of online shoppers return their purchases.

• Returns logistics affects sustainability. Longer return windows, storage and infrastructure problems, and the fact that returning low-value items doesn't make financial sense all have a negative impact on ecommerce retailers' sustainability efforts. On top of that, certain products such as underwear simply can't be returned. That means more waste and fewer opportunities to recycle or reuse unwanted goods.

• Customers are increasingly accepting that they have to pay for returns themselves. If you want to charge for returns in 2024, you can use the following figures from our study as a guide. German online shoppers are willing to pay the following return shipping costs:

  • €4.60 for an order with a purchase value of €15

  • €5.30 for an order with a purchase value of €50

  • €6.90 for an order with a purchase value of €150

• Our study also showed that 30% of German consumers won't place an order at all if the return window is shorter than 30 days.

The returns statistics below show strong growth in returns in Germany over the last few years. With a return rate of over 50%, we can only expect the number of returns to keep rising.

Returns statistics

Proven returns methods from big businesses

Many online stores have realized that returns can't be avoided. They are taking unconventional approaches to improve the way they handle returns.

1. During the last peak season, Amazon offered an extended return window . This meant that most items ordered between October 1 and December 31 could be returned until January 31 of the following year.

2. Beautylish, a well-known ecommerce company for cosmetics, has an extended return window of 90 days. It also doesn't ask its customers for the reason for the return.

3. Lazada, a marketplace operated by Alibaba, lets customers return items to sellers or through its platform, provided a return request is submitted within 15 days (for LazMall items) and 7 days (non-LazMall items) of receiving the order.

4. Zappos gives its customers a very generous 365-day return policy. The company also offers a “fast refund” service as part of its VIP program: the refund is issued as soon as the carrier has scanned the return parcel.

The best options for efficient returns in Germany

Of course, as an online retailer, it isn't always practical or possible to offer the same flexibility as retail giants like Amazon. And buying your own rocket, Mr. Bezos style, is probably not among your realistic options either.

But let's still look at some ways you, as an online retailer, can make your returns handling more efficient, save costs and make your business more sustainable.

1. Give your customers the right information at the right time.

Create clear, easy-to-read shipping and returns policies and make sure they are easy to find on your website.

Tell your customers what they can expect when it comes to returns. Do this both in your shipping and returns policy and at the key stages of the buyer’s journey, such as on product pages or in customer service hubs.

2. Get the right technology.

There are plenty of great apps and platformsthat help you manage your returns.

They often let you set shipping rules and automate processes. That saves you time and reduces costly mistakes when shipping parcels and managing returns.

We don't want to pat ourselves on the back, but our platform is used by many happy ecommerce customers. Take a look and find out how it works.

3. Include return labels in your shipments.

Consumers really appreciate return labels. By including a ready-to-use return label in the parcel, you make the returns process as easy as possible. Drastically reduce your customer support workload and optimize your returns without extra shipping costs. Unfortunately, though, they have a negative effect on your environmental footprint. So you might prefer to explore option 4:

4. Offer paperless returns.

Your customers shouldn't need more than a QR code to return a parcel. It's an elegant solution that also reduces your environmental footprint.

In Germany, Hermes C2C and DHL already offer this service, as does Amazon through UK post offices.

5. Use Easy Return solutions.

Easy Return Solutions (ERS) simplify international returnswithin the EU by making local returns easier for retailers and customers.

ERS solutions help avoid double customs duties and fees. Learn more about ERS in our Help Center.

How will ecommerce returns in Germany develop in the (near) future?

The big question is: how will returns develop in the future? Can returns become even easier?

Let's take a look into the crystal ball and see what the future holds for ecommerce returns.

Free returns: do they still exist?

It's understandable that customers still want low-cost or even free returns. As mentioned above, however, acceptance of paid returns keeps growing in 2024.

Our research already shows that 44% of our online retailer customers charge a fee for returns. That means almost half of Sendcloud customers offer paid returns.

The average return fee our customers charge is €5.66.

At Sendcloud, together with Mollie, we make it easy to offer paid returns in online stores.

While it's exciting that more and more customers are willing to cover return shipping costs, it's also important to know that most customers still prefer the online retailer to pay for return shipping. So make sure your return shipping costs stay within a reasonable range, so you don't lose loyal customers. Stay transparent and make sure your returns policy states the cost of return shipping and how it is paid.

It will certainly be interesting to see how consumer expectations and behavior affect the offer of free returns in the coming years.

The rise of parcel lockers

Fully automated parcel lockers make both receiving and returning goods simple and hassle-free. You've probably seen parcel lockers before, or even used them yourself.

The expected global market size for smart parcel lockers by 2024 is over 1 billion US dollars. This could make this practical, customer-friendly solution the first choice for brands that want to improve their returns handling and offer their customers convenience every day, around the clock.

“The DHL Packstation is becoming increasingly popular with our customers. Many millions of Packstation customers value the convenient and flexible service for sending and receiving their parcels. That's why we will expand our Packstation network from the current more than 9,000 machines to around 15,000 Packstations by the end of 2023.” Holger Bartels | Head of Multichannel Sales, Deutsche Post AG

The rise of label-free returns

Label-free returns do exactly what they promise. Instead of loose return labels, customers get a barcode or QR code provided by the retailer or carrier. This is scanned at the designated service point. Shipping and labeling are then handled from there.

DHL already offers this to business customers with its “Mobile Retoure” option. Amazon also already offers similar services in Germany. DPD is planning this too and is in talks with its parcel shop partners. In the UK, the carriers Inpost and Hermes C2C have started introducing solutions like this.

Local and last-mile carriers are on the rise

Retailers' race to deliver quickly to their customers has led to an increase in local and smaller carriers, or “last-mile carriers”.

During the pandemic, the number of bike delivery services and grocery delivery services grew sharply. Because they are locally focused, they can offer their customers more flexibility and make same-day delivery possible.

This delivery option is not yet widespread in the returns process. However, we expect businesses to consider this delivery option soon, especially in big cities like Berlin, Frankfurt or Hamburg.

There, a bike is far cheaper and more energy-efficient than a delivery van fighting its way through traffic. Which brings us straight to our next point …

Sustainable returns remain a focus

Local deliveries can do a lot more than save retailers time and money, though. An Accenture study predicts that with last-mile delivery, emissions can be reduced by 17% to 26% by 2025.

Other possible developments in sustainable returns in 2024:

1. More focus on end-to-end returns handling
The focus should be on simplifying sustainable returns throughout the entire process. This covers the whole flow: from the label, packaging and shipping method to the product being prepared to re-enter the supply chain.

2. Sustainable carriers
Most carriers now offer eco-friendly shipping options. UPS and Hermes provide CO2-neutral delivery.

DHL wants to further expand its electric delivery fleet to 37,000 vehicles and 14,000 e-trikes by 2025, and in the long term even transport around 20% of parcels by rail.

By 2025, DPD plans to switch its delivery fleet to low-emission vehicles in 23 German city centers, and has already designed a first prototype of an autonomous, electric delivery vehicle.

3. Reduce the need for returns on certain items
If you sell products such as underwear, very low-value goods, certain health and beauty products or food, it makes no sense to burden your customers with sending a return, because the items end up in the trash anyway.

Your compensation strategy depends on your business model and your customers' expectations.

Whatever you decide, always make your policies and product pages clear and unambiguous. For example, offer additional information in the FAQ or through a chatbot feature.

Getting returns under control: innovative market developments

If you're an innovative online retailer, you'll be the most successful at handling returns. You can also work with other businesses to do this.

As mentioned above, it will be interesting to see how both retailers and carriers respond to changing customer behavior and expectations.

Will cost control or customer satisfaction and loyalty take center stage? Will there be a clear winner and a standard for returns in the (near) future? Or will online retailers keep juggling different returns policies that aren't always customer-friendly?

Here are some interesting examples of innovative returns in the ecommerce market.

Drop-off at a non-competing physical store

We don't know about you, but we love the idea of combining a product return with an everyday routine. Going for a coffee, visiting a restaurant or doing the grocery shopping while dropping off a return at the same time: it saves your customers time, and the non-competing businesses also benefit from these product returns.

Artificial intelligence and machine learning

New and emerging technologies such as AI and machine learning are already delivering real value. They help ecommerce retailers better understand customer behavior and make recommendations based on customers' previous preferences.

They can also reduce returns for ecommerce retailers, for example by giving size recommendations for shoes or clothing. This is especially useful for items that are often sent back because they don't fit.

Artificial intelligence can even go so far as to warn customers before they buy that they are very likely to return the item, and prompt them to choose a more suitable product.

You probably already know some of the virtual fitting rooms or showrooms for home furnishings, like the one from IKEA? We'll see more and more of these tools in the coming years, as businesses use them to gain a competitive advantage, increase sales and reduce the number of returns.

Predicting returns after the order is placed

Artificial intelligence and machine learning can also help ecommerce retailers plan ahead for returns and manage inventory.

These tools can build a profile of each customer based on order history, creditworthiness, previous return rates and the reasons for returns (for example, the wrong size). This then shows each customer's “return risk”. Based on this information, you can adjust your marketing, plan inventory, change your prices and improve how you manage your logistics and shipping processes.

How to avoid returns headaches

It's truly amazing what AI and machine learning can do these days. Still, the question remains: what can you actually do to make returns as efficient as possible?

Here are some Sendcloud developments that can help you improve your returns management in 2024.

1. We offer a practical solution that gives ecommerce businesses of any size efficient returns software , both with our all-in-one software and with our API.

2. ERP systems and fulfillment centers can be connected to our API, so you can handle returns efficiently regardless of your current setup.

3. We work with multiple carriers. That makes it easier for you to offer your customers pickups for returns.

4. With DHL and Hermes, you can offer your customers paperless returns.

5. You can create return rules for different types of returns. Think about which carriers you want to work with for which type of return and for which countries. We also let you have customers pay for the return when they give a specific reason for returning. The data also feeds into your shipping analytics, so you can spot trends in return types.

6. Our platform lets you reject or approve returns. That helps you avoid unnecessary returns and costs.

7. You can activate return fees in your own return portal to set the cost of returns for your customers. With return rules, you can set different prices for returning different products.

Want to learn more about our returns solution? Visit our return portal and learn more about what our software and API can do.

Final thoughts

Efficient returns management isn't easy. But if you get it right, you can powerfully demonstrate your commitment to greater customer satisfaction and an outstanding customer experience. An efficient returns service also helps you plan inventory better and keep costs under control.

Whatever challenges and opportunities you face, it always pays to listen to your customers' wishes and needs and to keep offering the best possible end-to-end shipping and logistics solution. Good luck, and feel free to tell us about your experiences!

How much time can you save on shipping?