色色啦

And that鈥檚 why we have a returns problem that cost retailers and is contributing up to .

When you factor in returns fraud and all the items that end up being trashed, the problem is even worse. In 2022, merchants sent more than .

鈥淩eturns are a giant problem right now,鈥� says Sylvia Ng, CEO of , a 色色啦 company that鈥檚 reinventing the online returns process.

While trade disruptions are making things even more complicated, their solution to this dynamic global dilemma aims to dramatically reduce waste, fraud and emissions.

Here, Ng discusses problematic shopping behaviours, the logistics of navigating tariffs and how their company is providing many happy 鈥� and environmentally sound 鈥� returns.

How did this problem get so big?

There are a few key factors. One is bracket buying, which is buying multiple sizes of the same item in order to try them on and then return the ones that don鈥檛 fit. The other is wardrobing, which is popular among younger generations. It鈥檚 buying something, wearing it with the tag on and then returning it.

Those two things, along with Amazon making returns really easy, have led to an all-time high return rate. A lot of the merchants are experiencing 25 to 35 per cent return rates. In some cases, as high as 50 per cent. It has been increasing over the last few years.

That鈥檚 why ReturnBear exists. We鈥檙e trying to do three things: make the consumer experience better, lower the cost for the retailers and lower the environmental cost of this whole returns situation.

How does that work?

We have local logistics networks in Canada, the U.S., the U.K. and Australia where we take in and refund returned items.

Instead of a product having to go back to a centralized warehouse (abroad), we store it locally until the next customer buys it and we send it to them.

That way, the costs are reduced somewhere between 30 to 70 per cent and the emissions are lowered somewhere between 40 to 90 per cent.

The consumer is a lot happier because they don鈥檛 have to wait for a refund.

How is the tariff turmoil affecting your business?听

A return was expensive to begin with 鈥� somewhere around $30 (U.S.). Tariffs have made it even more expensive. We work with fashion merchants who are now rethinking their supply chains to protect margins. With duties rising on many products, the pressure is higher than ever to recover returned inventory quickly and cost-effectively.

The need for a solution like ReturnBear has gone way up but, on the flip side, because the tariff changes have been erratic, it鈥檚 been hard to land on an operational solution that is optimal because the landscape keeps changing.

Supply chain changes don鈥檛 happen overnight. It鈥檚 not software. You need to actually operationally change things in countries with localized teams, laws, taxes, et cetera.

Have you changed your approach to weather these times?

In the last six months, we have found we need more patience, need to be flexible and to plan for unknowns.

All these tariffs have made us anticipate that changes will happen. Trump will continue to change tariffs with various countries, and with that, merchants will need to adapt their supply chains to reduce the impact of duties on goods. He just got rid of the de minimis (U.S. tariff exemption for low-cost imports) for goods coming into the U.S., and that鈥檚 a huge change for the e-commerce industry.

What does the return fraud landscape look like right now and how are you countering it?

Fraud as a market size has hit a crazy number. There are reports now of it being around .

A lot of the fraud takes advantage of disconnected systems. When you have a retailer whose systems for selling online are separate from how they sell brick-and-mortar, it is very easy for a consumer to take advantage.

(Typically,) if you want to return something you bought online, you get a shipping label from the merchant and then you ship that item.

Because merchants don鈥檛 want the consumers to have to wait for refunds, they said, 鈥淟et鈥檚 refund this customer when they bring the item into Canada Post.鈥�

That has led to a lot of consumers saying, 鈥渨ell, no one鈥檚 actually checking what鈥檚 in the box. I can put anything in the box and still get the refund.鈥� And, because they still have the item, they can walk into a store and (get a second refund).

ReturnBear gives out instant refunds at our local return points across Canada in Staples and Cadillac Fairview malls, where consumers don鈥檛 have to package anything and they don鈥檛 need a shipping label.

We verify that the item is in fact what you鈥檙e supposed to return 鈥� the right size, the right SKU and that it鈥檚 not damaged. The fraud is almost 100 per cent curbed.

By verifying the items customers bring to your return points, what kinds of sneaky things are you finding?

Empty bags, bricks, bags of sand.

What kind of environmental impact has ReturnBear achieved?

We keep it local, which makes a huge difference.

For example, we鈥檙e working with a merchant that dropships (where online sellers ship directly from manufacturer to customer) from China.

When they sell into Canada and get returns, we send it to the next local customer for them. That journey to the next local customer is 40 kilometres on average.

When you send it back to China, do you know what the average distance is? It鈥檚 10,500 kilometres. We are basically saving 99 per cent of transportation emissions.

I did a calculation for that merchant one month when we had around 225 returns.

By e-commerce terms, that is a very small number. But it was the equivalent of planting 50,000 trees, waiting for them to grow 20 years and catching carbon over 20 years.

Despite recent market conditions, are you seeing opportunities for growth?

Oh, there鈥檚 lots.

We have expanded our network to major English-speaking markets, but we鈥檙e still leaving a lot of the globe un-tackled. Global expansion is a huge opportunity and we鈥檙e likely going to look at the EU next.

When you shop online, what do you look for in a returns policy?

As a busy mom, I look for convenience.

Are you going to make me go very far? What are the (opening) hours? Do I need to print out a shipping label? And will the (return) policy cover what I鈥檓 looking at? Oh, and cost, obviously.

I don鈥檛 want my purchase to have a burden on the environment.

I would like both brands and consumers to think a little bit more about returns.

Not just because of the cost but because of the environmental impact.