The Modern Retail Podcast Rundown: Return fraud on the rise, Nordstrom going private and Big Lots' lifeline
Jan 4, 2025
Retail return fraud is skyrocketing, costing businesses a staggering $103 billion last year. In a bold move, Nordstrom is going private through a buyout with family backing, aiming to escape public scrutiny. Meanwhile, Big Lots unexpectedly secures a lifeline from an investment firm, aiming to keep hundreds of stores operational despite recent liquidations. The discussions reveal strategies retailers are adopting to tackle these pressing challenges in an evolving marketplace.
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Retail Returns Remain a Challenge
- Retail returns continue to be a significant challenge for businesses, impacting their bottom line.
- Fraudulent returns, wardrobing, and buying multiple sizes contribute to the problem.
Cross-Retailer Fraud
- A new type of return fraud, "cross-retailer fraud," is emerging.
- Customers exploit price differences between marketplaces like Amazon and cheaper sites like Temu and Shein.
Duplicate Products Facilitate Fraud
- Many products on Amazon and Shein look identical because they come from the same factories.
- This makes it easy for customers to swap cheaper items for more expensive ones when returning.