PrettyLittleThing faces backlash after scrapping free returns

PLT is part of the Boohoo Group, which was founded by Mahmud Kamani and retail executive Carol Kane in 2006.

The brand started out as an accessories-only outfit, with a focus on on-trend, low-cost pieces.

It was co-founded and headed up by Umar Kamani, one of Mahmud Kamani’s sons, who drove the brand’s collaborations with the likes of supermodel Naomi Campbell and its expansion in the US.

While it has come under the spotlight for its working practices, the Boohoo Group was one of the big winners of the pandemic, as online retailers thrived.

However, it has since faced several challenges with the rate of returns normalising, rising competition from ultra-fast fashion brands like Shein, and customer budgets being squeezed during the cost-of-living crisis.

According to official filings, external, in the year to 28 February 2023, PLT’s sales dropped from £712m to £634m, while its profits before tax more than halved.

The company said profits had been dented because of technology upgrades it was making in its huge Sheffield warehouse.

And, for fashion retailers, returns can be costly.

There is also the environmental impact of using delivery trucks for online returns to consider too.

Retail analyst Catherine Shuttleworth said that customer returns represented a significant headache.

H&M, for example, was forced to U-turn on introducing a fee for shoppers who return online purchases in-store after customers spoke out.

While shoppers have grown accustomed to free deliveries or returns, retailers are facing cost pressures which mean they need to recoup these costs or raise prices, she said.

She pointed out that with sales slowing among younger consumers who are opting for more sustainable ways of shopping on second-hand sites like Depop or Vinted, brands were having to make cost decisions accordingly.

“Businesses need to dissuade shoppers from returning and when they do they need the shopper to pay for it,” she said.

The rise of buy now, pay later schemes like Klarna or Clearpay has also led to some shoppers placing orders for multiple products, trying them on and sending some back before any money has left their account.

As a result, online brands have also clamped down on their return policies, introducing stricter rules and inspections for clothes that are returned and refusing refunds in some cases where there are signs the clothes may have been worn out and about already.