Currently, handling returned goods is one of the biggest expense items in e-commerce. Warehouse workers spend hours unpacking, inspecting, and sorting products that have been sent back, while customer service handles inquiries about refunds.
Our compilation, based on the behavior of Swedish consumers, shows that returns in e-commerce already cost around 7.3 billion Swedish krona per year, just over six percent of turnover. Of that, about a third is operational cost that you can actually automate away. The rest is value depreciation and write-offs, says Jennie Gerum to Ehandel.se.
Jennie believes that the actual risk with the new legal requirement depends entirely on how companies choose to manage the administration behind the scenes.
The risk with the regret button is small if you do it in a structured way. High if you do it wrong, she says and continues:
Keep two things separate. A return is governed by your own return policy. You set the deadline, requirements, and conditions. A regretted purchase is governed by the Distance Selling Act: the customer does not need a reason, has 14 days from when the goods were picked up, and you may not require the product to be in a certain condition.
Traps That Drain the Cash Register
As legislation now forces a frictionless, digital path for the customer to withdraw from their purchase, new challenges arise for the underlying business systems. If an e-commerce retailer only adds a form to their site without connecting it to the warehouse, costly gaps in the chain quickly arise.
The risk arises when the flow is set up incorrectly. Three common leaks: you have not changed the terms of purchase and are forced to pay the return shipping. You must always repay the outbound shipping for a canceled order, you will never get away with that. And deductions for goods that are not resalable must be automated, otherwise you either lose money or drown in manual assessment of each individual case, says Jennie Gerum.
Another scenario is when the deadlines are not synchronized with the warehouse deliveries.
Add to that you must be able to block cases after 14 days. Otherwise: how do you handle a regretted purchase that appears in the warehouse on day 20? You block it before it arrives. Individually it sounds small. Multiplied by each manual case, it becomes a lot of money.
The regulations regarding shipping costs have been a topic of discussion among retailers ahead of the law change. The digital button function must be free to use, but companies are free to let the customer pay for the transport back to the warehouse.
It is up to each company whether they want to pay for the return shipping or not. If you want the customer to pay for it, that is perfectly fine, but it must be stated clearly in the terms of purchase. If nothing is stated there, the cost falls on you, says Jennie Gerum, but points out at the same time that the money for the way to the customer follows a different rule:
But you will never get away with the outbound shipping. In the event of a cancellation of an entire order, it must always be returned. That is the difference from a regular return. If you charge for outbound shipping at the time of purchase, you must refund it when the customer regrets their purchase.
Focus on Margins Over Volume
A recurring question ahead of June 19th has been whether the simplicity of the new function will cause consumers to return more than before.
There is a risk that they will increase, but I think it will be marginal. The customer is aware today, and rarely returns because they want to, but because they have to. Then there are always corner cases and deviations.
Instead, she believes that e-commerce retailers should look at the expenses per handled item.
What does increase, if you haven't set everything up correctly, is the cost. That's where the crucial thing lies: cost control. Automatic deductions for goods that cannot be sold again, and a cost flow that lasts all the way. If you don't do that, that's where the margin leaks, not in the volume.
When it comes to the technical preparations, there is an established view that resource-strong giants have a head start over smaller businesses.
In theory, there is no difference. It's about building an integrated after-sales process, not about size. Large companies often have more advanced solutions, more stores, markets and volume, and established processes. If they are already running a return solution, it is easier, as they add the regret flow to the existing one, says Jennie Gerum.
The goal, regardless of the size of the webshop, is for the systems to handle the deadlines automatically.
What you want is for the 14-day regret to automatically transition into the return policy after day 14, and for warranty and complaint to become the only natural flow when that time closes. Seamlessly. Smaller companies are often more agile.
Customer Service May Drown During Summer Sale
Taking shortcuts with the new function can quickly backfire on your own staff.
The trap, regardless of size: a simple form solution on the site does not solve the problem. You must be able to trigger a confirmation email immediately, differentiate regretted purchases from returns and complaints in the warehouse, and keep cases away from customer service. Think about the summer sale. If you do this wrong, customer service will be overwhelmed.
Jennie Gerum highlights how proper optimization can cut costs for each incoming package, and mentions the sports chain Stadium as an example.
For companies like Nelly and Stadium, optimizing the after-sales journey is in their DNA. Stadium has gone from 50 krona to under 10 krona in return costs. That is the mindset required: see everything as an integrated process, where every decision affects whether the customer will return or not.
For online stores that are already seeing their profit margins eaten up by return handling, there are specific actions to take on the logistics side.
Stop running all returns as a single one-size-fits-all flow. That's where most lose the most. You don't know what's coming into the warehouse until it's there, which creates waiting and makes the product slow to get resalable again.
In addition to the warehouse shelves, it is the staff's time that costs money.
Start measuring how much customer service is sitting in return cases. That is both a large cost and a bottleneck: overloaded customer service means that cases grow, the customer has to wait for days, there are bad Trustpilot reviews and fewer returning customers. Look at the process. What is handled manually today? If you remove that, costs will decrease, the customer experience will improve, and ultimately it will affect the top line.
Not Ready for Friday's Deadline
With just days to go until the law comes into force, the focus is on how well prepared the market actually is. When asked if the Swedish e-commerce industry is ready with the regret button in place, Jennie Gerum replies:
No. It is noticeable that it is not. At the same time, the pressure and interest in regretted purchases is enormous. With new laws, it is always difficult to know exactly what to do. Therefore, e-commerce retailers should lean on an after-sales platform that knows how the law is interpreted and has a solution for it.
For those who have not yet updated their systems, there are still things to do before Friday.
The important thing before Friday is to have a clear implementation strategy, and it is not too late to put it in place, says Jennie Gerum and concludes by summarizing the requirements that companies must relate to:
Many still do not see the whole process. It must cover: 14 days of regret from pick-up, 14 days to repay after the goods have been submitted, a clear confirmation, the ability to regret all or parts of the order, repayment of outbound shipping, and return shipping if it is not stated in the terms of purchase and direct confirmation by email.