Holiday returns surge 11%: Reverse logistics boom

Speakers

Reporter — Host/Narrator

DHL Head of Returns — Executive at DHL

Anaka Kumar — CEO of Narvar

Holiday returns are forecast to increase 11% year-over-year, creating a massive volume of "reverse logistics."
Processing a return costs a retailer approximately $30, compared to just $12 for a standard delivery, creating a revenue opportunity for logistics providers.
The trend of "bracketing" (buying multiple sizes to try on and returning the rest) is becoming standard behavior, with 50% of consumers participating, led by Gen Z and Millennials.
Logistics companies view returns as a "value-added service" that commands higher profit margins than commoditized outbound shipping.

Ticker	Direction	Speaker	Thesis	Time
UPS /FDX /CHRW /PLD /TRNO	LONG	—	The reporter identifies UPS, FedEx, and C.H. Robinson as leaders in reverse logistics, alongside warehousing REITs Prologis and Terreno Realty, as the best way to play the surge in returns. Handling returns is more complex than standard shipping. Because it is a "specialized" service, logistics companies can charge a premium, resulting in better profit margins compared to commoditized delivery. Furthermore, the demand for this service is structural and growing due to "bracketing"—where shoppers intentionally buy more than they need (e.g., multiple sizes) with the intent to return, a habit deeply ingrained in Gen Z and Millennial consumers. Holiday returns are up 11% YoY. Returns generate significantly more revenue per unit ($30 cost to retailer vs. $12 for delivery). 50% of consumers now engage in bracketing. Retailers may tighten return policies to reduce costs, potentially lowering volume for logistics providers.	1:25