Consumer Electronics Industry in Trouble: $17 Billion in Returns This Year

By Miguel Leiva-Gomez December 13, 2011

Customers dissatisfaction seems to have reached quite a high this year, as $17 billion in returns were filed for the year 2011 in the consumer electronics industry. That figure is roughly 21 percent higher today than it was four years ago. This brings up the question: Does this happen because electronics don’t work like they used to, or does it happen for a reason we’re not observing?

The process of a return involves reception, assessment, repair, rebox, restock and resale. All of these things cost plenty of money and usually cost businesses plenty of money with increasing return rates. More than half of retailers and almost half of all manufacturers report an increase in returns, while only 13 percent of retailers and 12 percent of manufacturers surveyed by Accenture report a decrease in returns.

While returns are impressively high, it seems that consumers are exercising irresponsibility rather than manufacturers. Only 5 percent of returns actually had defects. The rest of the returns seem to spawn from either a lack of understanding about the product or a conscious decision on behalf of the consumer to return the product based on a change of heart.

Customers with “buyer’s remorse” account for 27 percent of all returns. The rest of the returns (68 percent) had no defect found, although the consumer specified one. This may be due to the lack of understanding a consumer might have on the product the person buys.

Accenture sees the most room for improvement in the “No Trouble Found” department of returns. Companies can decrease instances of erroneous “defect” returns if they reach out to consumers and help them establish a better understanding of the products they buy. A 1 percent decrease in “NTF” returns provides savings of up to 4 percent in a major manufacturer’s return bill. That translates to an average of $21 million.




Miguel Leiva-Gomez is a professional writer with experience in computer sciences, technology, and gadgets. He has written for multiple technology and travel outlets and owns his own tech blog called The Tech Guy, where he writes educational, informative, and sometimes comedic articles for an audience that is less versed in technology.

Edited by Jennifer Russell

TechZone360 Contributor

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