Success Story: How Happy Returns Helps PatPat Cut Return Costs by Up to 40%

Success Story is a Sourcing Journal feature highlighting innovative solutions across all areas of the apparel and footwear supply chain.

High return rates, aka the “trillion-dollar problem” affecting the entire value chain from supply chain and inventory to customer experience, is one issue the fashion industry is working overtime to mitigate.

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According to a Blue Yonder survey released earlier this year, 38 percent of shoppers make a return once or twice a year. Among the top reasons for those returns are incorrect size or fit (77 percent) followed closely by defective or damaged products (65 percent). And 22 percent of respondents admitted to ordering several items to try on for fit—aka “bracketing”— while 11 percent returned extra items ordered to get a shipping discount.

Adding fuel to the fire, the excess packaging being shipped back and forth is further polluting the environment—and consumers are becoming increasingly aware of that impact. Per a McKinsey study, more than 60 percent of consumers in 2021 went out of their way to purchase products in environmentally friendly packaging.

Global children’s e-commerce brand PatPat has turned its attention to returns and is looking to simplify the process for consumers through a new partnership with third-party reverse logistics startup Happy Returns—all while keeping costs and sustainability top of mind.

“Before working with Happy Returns, the return process was longer for customers who needed to speak with a customer service agent to file a return request, then wait to get the request reviewed and approved, which could take several days,” said Ranu Coleman, head of marketing at PatPat. “Now, with Happy Returns, it takes a few hours or less. We also had limited options for customers before—in terms of having locations to drop off items, offering exchanges for store credit and mailing the items back to PatPat—and now they have so much more.”

Partnership kick-off

When Coleman first started working at PatPat in July, she saw an immediate need to simplify the return process and make it “as seamless as possible” for the brand’s consumers.

“I worked with Happy Returns at previous companies and saw the benefits of working with them to create a frictionless return process for customers,” said Coleman. “That said, we saw a need for a service like Happy Returns at PatPat, so we began conversing with them in July and kicked off our partnership in October.”

Happy Returns accepts and processes box-free returns for retailers at its network of more than 5,000 Return Bars across the U.S. These multi-brand Return Bars are found within major retailers like FedEx, Staples and Ulta Beauty, and about three-quarters of U.S. consumers have a location within 10 miles of their homes. The Return Bars also allow merchants to aggregate returned items and can help save up to 40 percent on return shipping costs.

“The process is very seamless. The customer can select the items they wish to return and can choose to drop them off at a Happy Returns location or box and ship items using a prepaid label,” said Coleman. “Once the return/refund request has been confirmed, PatPat will finish processing it within 2 to 5 days.”

One major selling point for PatPat was the sustainable benefits Happy Returns offers, including using 100 percent reusable boxes. By replacing cardboard boxes with reusable totes, Happy Returns customers reduce greenhouse gas emissions by 120,000 pounds for every 1 million returns. PatPat has also minimized its carbon footprint by reducing trucks on the road since Happy Returns’ reusable boxes “stack perfectly in trucks so they can ship more items with fewer trips,” the brand said.

Additionally, with Happy Returns, PatPat can now offer its customers a printer-free, packaging-free sustainable return and exchange process—eliminating the need for excess packaging which often ends up in landfills.

“The real driver of this collaboration is around customer retention,” said Coleman. “Returns are a part of our business, and Happy Returns makes the process easy for [us] and our customers.”