A lot of things get returned. A lot of things never get bought in the first place.
Some of it gets donated, some of it gets sent back to the manufacturer or a retail partner (such as a third-party seller on Amazon), and some of it gets sold to a liquidator for pennies on the dollar.
Once the selected returned or unsold stuff is bundled into big boxes, it moves into what’s called the secondary marketplace. It can be resold in a number of ways, including in places like Dollar General and T.J.Maxx, at flea markets, or through independent shops, both brick-and-mortar and online.
I had originally planned to get a pallet of unclaimed mail, which would have contained the largest variety of products, figuring that would be the best way for us to really learn something.
But I ended up getting a returns pallet, with goods mostly from Amazon, judging from the paper slips inside the packages. From what I could tell, when customers across the country had initiated their return on Amazon’s site, the label they’d been given had sent the package directly to a return center in New Jersey. Such products seem to move along the chain pretty swiftly, if our pallet is any indication; items that people had purchased in May and returned in June were included in the pallet we bought in August.
Amazon says it carefully inspects each item and evaluates the piece to determine if it can be relisted for sale. However, the bags and boxes we received in our pallet were still sealed. Our best guess is that they had been passed on to the liquidator warehouse unopened.
I sent Amazon an interview request to talk about returns and the reverse supply chain. A spokesperson responded with a general statement emphasizing that the company’s “goal is to make purchasing products — and returning them — as easy as possible” and confirming that excess products “are resold as new or used, returned to selling partners, liquidated, or donated.”
A returned product’s journey
Few-questions-asked return policies are convenient for the customer. They also make the industry rife with return fraud, in which a buyer initiates a return but isn’t honest about the item’s condition. There are also cases where a con artist replaces the item with something else. As a result, new customers can receive used or incorrect items in their orders — and that could further increase the retailer’s incentive to just move the stuff along. An estimated 9% of returns are fraudulent, according to the NRF report.
From the retailer’s point of view, checking over every return may not be worth the time and effort, and the stock costs them money the longer it hangs around. If they throw it out, they have to pay for disposal. “Even if you’re marking it down and keeping it in your store to sell it — there is always that clearance section in the store — you’re still occupying relative space,” said Rajeeb Mohapatra, a logistics and supply-chain expert. “It is costing the store at a much lesser value until it gets sold.”
Most people said they hadn’t really thought about where their stuff went after they sent it back. They just assumed that it would be restocked, and someone else would buy it.
What most people don’t expect is that some of the items they reject will never get restocked, only to end up, in this case, in a basement in Long Island City, New York, via a small-town warehouse.
“The secondary market mitigates the wastefulness, but also it allows for more wastefulness, because what we keep doing is just figuring out ways to get rid of more and more of this,” said Rogers. “It’s like adding lanes on the highway. It will relieve traffic, but it also invites more traffic.”
“In American society, we’re over-consumers, over-producers, over-everything, right? The excess we have is not good. We’re polluting the environment. We pollute the landfills, or we ship it to Ghana,” said Dean Moussalli, then the director of marketing and digital strategy for Via Trading, a wholesale liquidator. But with the secondary market, “we’re creating a green-circle economy,” he continued. “Instead of big boxes throwing things in the garbage, we’re giving products another life.”
People are building businesses, some large, some small, through reselling. Moussalli told me that Via Trading has customers who make anywhere from $15,000 to $4 million a year reselling. It can be an entry point for people who are just starting out or looking to get on their feet after a job loss.
“It’s an industry for entrepreneurs,” said Moussalli. “It’s an industry for the people who want to work for themselves and grow their business and become their own boss.”
I’ve certainly grown more thoughtful about my purchases and returns.
This article shouldn’t stop you from buying things. Nor should it stop you from returning things that don’t work for you.
Done in excess, however — that’s how you get thousands upon thousands of pallets packed with untold numbers of undelivered, unsold, and unloved things.
After all, as Violet Beauregarde, Veruca Salt, Mike Teavee, and the rest of the Wonka wannabes also learned, too much of anything can be harmful.
