Holiday Gift Returns Surge to $11 Million

Shopping for Valentine’s Day? Post-Christmas gift returns hit $11 million in just two weeks. Rising living costs are making shoppers rethink their spending, with many opting to return unwanted gifts for cash instead.

A returns management platform reported that 88,600 items were sent back between December 26 and January 12. Dresses led the list, making up 29.4% of all returned items—that’s over 26,000 pieces. Trousers, skirts, leggings and jeans followed at 24.6%, while tops like shirts and blouses accounted for 24.3%. Footwear wasn’t as commonly returned, but sandals and thongs made up 35% of that category.

Retailers are feeling the pressure as they manage the impact of returns, often recouping only half the original product value. Out of the $11 million in returned goods, businesses retained just $5.1 million in resale value and made $154,000 from reselling returned products. Software solutions are helping retailers streamline the process, but fraudulent returns and changing consumer habits add new challenges.

To counter the financial hit, many retailers are adjusting their return policies—shortening return windows, introducing return fees, or even allowing customers to keep low-value items. Some brands are also turning to AI-powered virtual try-on tools to help shoppers make better choices before buying.

With returns now a routine part of shopping, businesses are rethinking their approach to minimise losses while improving customer experience. The post-holiday season has revealed a growing shift, as consumers adapt their spending habits to meet financial pressures.

Source: The Australian, NBC, My Home Appliances, CNBC, ABC