Tariff Costs Boost Demand for Efficiency in Reverse Logistics

The reverse logistics industry is reportedly benefiting from new U.S. tariffs.

Because new goods are more expensive due to tariffs, while returned goods have already had their tariffs paid, companies are anxious to get returns back on the market as soon as possible, CNBC reported Wednesday (June 25).

The more efficient the reverse logistics process — in which returned items are inspected and prepared for resale — the faster the retailer can make the sale, according to the report.

This trend has been helped by the willingness of a majority of shoppers to purchase reCommerce goods, the interest of retailers in offering a secondhand channel, and the prevalence of online shoppers buying items in different sizes and then returning the ones they don’t want, per the report.

It was reported in April that investors expected tariffs to be good for sellers of secondhand goods. Secondhand sellers can sell merchandise that is immune from the tariffs, draw bargain-hunting consumers, appeal to other consumers who are looking to sell items for extra cash, and raise prices because sellers of new imported goods will have to do the same.

Online resale marketplace ThredUP delivered better-than-expected first-quarter earnings on May 5, with CEO James Reinhart saying that the proposed tariffs on Chinese imports could reinforce shoppers’ taste for secondhand clothing by curbing production of new clothes and making them more expensive.

“If the price of new clothing goes up because of these tariffs, we believe this enhances the comparative value proposition for consumers who shop for used clothing on ThredUP,” Reinhart said during the company’s quarterly earnings call.

The PYMNTS Intelligence report, “Consumer Tariff Sentiment: Informed Americans Are Skeptical of the Benefits,” found that nearly half of U.S. shoppers expect tariffs to raise prices at double the current inflation rate.

More than 8 in 10 consumers are taking steps to offset the financial impact of tariffs on their pocketbooks, according to the report. The average individual is making nearly five such behavioral changes, and 44% of consumers have already changed their shopping habits in response to tariff-induced price pressures.

Retailers are reacting in several ways, in some cases experimenting with “good, better, best” product tiers, per the report.