Walmart and Amazon are offering 'returnless refunds' — here's how you can keep products for free

The way returns usually work is that the customers unhappy with a product give it back at a drop-off point or else the item is picked up before a refund is processed. But, as this process is tedious and time-consuming, retailers such as Amazon and Costco have return policies that provide quick refunds. Since different players in the sector are competing to attract customers using convenience in addition to discounts, Walmart and Target now have a policy that allows customers to have their cake and eat it too.

While returning items is an inconvenience for customers, it costs retailers money as well. According to a report from the National Retail Federation, the total returns for the industry amounted to $743 billion in 2023.

For $1 billion in sales, the average retailer had to process $145 million in refunds for returns, the report said. Furthermore, online sales see a higher return rate with 17.6% of merchandise sold. Hence retail giants like Amazon, Walmart, and Target decided to cut the cost spending on logistics to retrieve the items and are simply allowing customers to keep the product despite refunding them for it.

"Major retailers have unlocked a strategic approach: allowing customers to retain certain items instead of returning them. This tactic is especially common for low-cost items," according to the “Returns Report: 2023 Holiday Predictions” report. 

Here's How to Get Refunds Without Returns

The secret "keep it" policy, can be good for the retailer and the consumer but it often works only for cheaper items. For instance, if a $20 shirt costs $30 in shipping to return, and so the retailer won't bother to get it back. While this policy is generally limited to cheaper items some lucky shoppers have scored refunds on more expensive products as well. 

Dalya Harel, 48, got to keep an expensive desk for free according to The Associated Press. Harel told the outlet that she got the desk from Amazon for roughly $300, but when it arrived, she noticed that some key pieces were missing and it would be impossible to put it together without them. She couldn't request a replacement either as the new item wouldn't have arrived in time since it was out of stock. Thus, the regular Amazon customer had her team reach out to the company's customer service line to initiate a return.

However, she was surprised to hear that the company offered a full refund without asking her to send the desk back. This shows that one can never know if their product is eligible for a returnless refund. In a statement to the news outlet, Amazon said it offers returnless refunds on a “very small number” of items for the “convenience to customers.”

While the returnless refund policy saves money for retailers, it creates some problems as well. "Allowing customers to keep items may be less damaging to the bottom line, but there is still an impact of essentially giving away products for free," Neil Saunders, the Global Data Retail Managing Director shared on RetailWire. While the cost of doing business covers these returnless refunds, some suggest there has to be a better way.