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Retailers on pressure to up returns game as Germany rolls out new regulation

generous returns

The German government has passed a new law that will make the destruction of products more difficult, upping the pressure on retailers to find a better way of dealing with returns.

The new legislation, which also includes laws for use of materials such as disposable cups, will prohibit companies from destroying stock unless it is unusable.

EU member states are required to implement revisions to their waste management laws aim to prevent waste and encourage recycling with the idea of creating a circular economy.

Many retailers destroy stock at the end of seasons in order to free up space for warehouses. Returns are also coming under scrutiny due to the carbon emissions generated by the return journey.

However, Germany-based fast fashion giant Zalando said its existing processes mean it will not fall foul of the new regulation.

“The destruction of goods and returns not only lacks any commercial logic, but in particular contradicts our understanding of sustainable management,” said Jan Bartels, Senior Vice President Customer Fulfillment at Zalando.

“We are counting on the German government to provide clear and practicable guidelines for the planned reporting obligations for retailers.”

The retailer said that although it has a returns rate of around 50%, 97% of its articles are sold again via the Zalando Shop while others are sold via Zalando Lounge or outlet stores or donated. Only around 0.05% of articles are destroyed due to necessity, the company added.

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