What Retailers Told NRF About Holiday Returns, and a Checklist to Measure Your Plan Against It

Retailers told the National Retail Federation and Happy Returns to expect about 17 percent of holiday sales to come back. Your plan should start from a number like that, not from hope.

The figures below come from the 2025 Retail Returns Landscape report, released in October 2025. I did not find a 2026 edition at the time of writing, so treat them as the most recent published benchmark and check NRF for an update.

The numbers worth knowing

• Retailers estimated returns at 15.8 percent of annual sales, about $849.9 billion.
• Online returns were expected to reach about 19.3 percent of ecommerce sales.
• Retailers expected 17 percent of holiday sales to be returned.
• 9 percent of all returns were fraudulent.

What retailers planned to do

• 49 percent planned to lean on third-party logistics partners.
• 43 percent planned to hire seasonal staff to handle returns.
• 37 percent planned to extend return windows.

Those are plans, not proof that they work. Use them as a checklist of decisions to make, not a list to copy.

Step 1: Turn the benchmark into dollars

Multiply your forecast holiday sales by a return rate you choose. At 17 percent, $200,000 of holiday sales produces about $34,000 in returned merchandise.

Use your own history if you have it. A category with high return rates, such as apparel, will sit well above a blended figure.

Step 2: Size the dock

Estimate the number of returns by week, with a lag of one to three weeks after each sales peak. Then decide who receives, inspects and restocks them, and how fast.

If your plan relies on a partner, ask for their January capacity and turnaround in writing.

Step 3: Decide on the window

An extended holiday window is a policy choice with a cost. Pick a clear end date, such as January 31, and state it at checkout and in the order confirmation.

Consider starting the clock at delivery rather than purchase. A gift that arrives on December 22 should not have a window that is half used.

Step 4: Steer the outcome

Every return that becomes an exchange or store credit keeps revenue in the business. Set defaults that make those paths easy, and keep cash refunds available.

Calculate the break-even on a store credit bonus so the incentive is generous but not wasteful.

Step 5: Plan for fraud

With 9 percent of returns reported as fraudulent, build triage into your process. Common tactics in the report include overstated quantities, empty boxes and decoy items.

• Inspect on receipt for high-value orders.
• Flag repeat returners for review, not automatic denial.
• Keep photos and notes on every exception.

Step 6: Set the reserve

Finance should book a returns reserve in December against January refunds. Compare the actual rate in January and adjust next year's number.

Your checklist

1. Holiday sales forecast and chosen return rate.
2. Dollar and unit forecast of returns by week.
3. Dock capacity and turnaround target.
4. Return window end date and wording.
5. Exchange and credit defaults.
6. Fraud triage rules.
7. Reserve booked.

Every item above is easier when returns have a clear cost per unit. ShipAid Returns & Exchanges offers discounted labels with no monthly software fee, merchant-controlled fees, and store credit, partial refund and keep-the-item outcomes. Explore ShipAid Returns & Exchanges.