It’s safe to say that online shoppers like the promise of easy — and even better, free — returns. But it may surprise consumers to learn what can actually happen to all those unwanted items.
A Marketplace investigation into Amazon Canada has found that perfectly good items are being liquidated by the truckload — and even destroyed or sent to landfill. Experts say hundreds of thousands of returns don’t end up back on the e-commerce giant’s website for resale, as customers might think.
Marketplace journalists posing as potential new clients went undercover for a tour at a Toronto e-waste recycling and product destruction facility with hidden cameras. During that meeting, a representative revealed they get “tons and tons of Amazon returns,” and that every week their facility is breaking apart and shredding at least one tractor-trailer load of Amazon returns, sometimes even up to three to five truckloads.
“We’re not the only ones. We couldn’t handle all of Amazon. There’s no way. It is so — it’s like cockroaches, it multiplies. It’s incredible,” said the operations manager.
CBC News is concealing her identity because both this company and others that help Amazon dispose of or resell its online returns are afraid they’ll lose their contracts if they speak publicly.
“Some of it will go into landfill,” said the operations manager. “Like, nothing 100 per cent goes into recycling. It just is not possible.”
Eco-blogger Meera Jain was extremely disappointed to learn about how some Amazon returns are being shredded for recycling, or sent to landfill.
“Our recycling system, not only in Canada but around the world, is extremely, extremely broken,” Jain said.
“We could resell, we could re-gift, we could re-home somehow or reuse it somehow. That would be way preferable to recycling.”
Jain likes the convenience of online shopping but worries about Amazon’s carbon footprint. She started buying more on the platform after the coronavirus pandemic hit, and she’s not alone.
E-commerce sales have more than doubled in Canada in recent months.
Secret GPS trackers and one backpack’s journey
Kevin Lyons, an associate professor at Rutgers University in New Jersey who specializes in supply chain management and environmental policy, says that 30 to 40 per cent of all online purchases are sent back. That number drops to less than ten per cent for merchandise bought at bricks and mortar stores.
To further investigate where all those online returns end up, Marketplace purchased a dozen products off Amazon’s website — a faux leather backpack, overalls, a printer, coffee maker, a small tent, children’s toys and a few other household items — and sent each back to Amazon just as they were received but with a GPS tracker hidden inside.
Marketplace teamed up with the Basel Action Network, a non-profit Seattle-based environmental organization that specializes in tracking waste and harmful products around the world. The trackers became a guide into the secretive world of e-commerce returns.
Many returns took a circuitous route, often covering several hundreds — sometimes even thousands — of kilometres to reach their final destination. Marketplace returned toy blocks that travelled over 950 kilometres before reaching a new customer in Quebec. And a printer clocked over 1,000 kilometres while circling around southern Ontario.
Of the 12 items returned, it appears only four were resold by Amazon to new customers at the time this story was published. Months on from the investigation, some returns were still in Amazon warehouses or in transit, while a few travelled to some unexpected destinations, including a backpack that Amazon sent to landfill.
The backpack that Marketplace returned in brand-new condition — but with a tracker inside — can be traced directly from the Amazon warehouse in Mississauga, Ont., to a waste management facility in Toronto.
When Marketplace took Amazon shoppers to that facility, they were surprised by what they heard.
“I’m just truly shocked by that,” said Magida El Timani, who shops frequently on Amazon. “I would want that bag.”
She says Amazon’s decision to throw out the returned backpack makes her re-evaluate where she does her shopping. “I just truly have so many questions … for everybody at that company. It does make you rethink shopping at Amazon.”
Marketplace producers returned the backpack in brand-new condition and filmed it on camera. Amazon says the handbag arrived damaged and could not be resold.
But the problem is much bigger than one backpack.
Optoro, a technology company that specializes in streamlining reverse logistics — the process of sorting through retail returns — estimates that $400 billion US worth of merchandise is returned to all retailers every year, which generates five billion pounds of waste directed to landfill in the U.S.
Although the Retail Council of Canada does not have specific metrics for Canada, it points out that items sold online have higher returns than bricks and mortar stores, and says those returns need to be managed carefully.
Marketplace bought a truckload of Amazon returns
Amazon does sell returned merchandise on its website via a platform called Amazon Warehouse. Amazon returns are also sold by liquidators — large pallets or single items can be purchased online by the public through virtual auctions.
Marketplace journalists purchased three skids of Amazon returns at one of these auctions, and then asked a veteran liquidator to assess their value.
Roy Dirnbeck, who has been in the liquidation business for 27 years and has several stores across the country, says he regularly sees tractor trailer loads of Amazon returns.
“They can’t keep up with the returns, so they just find fast ways to sell it by the skid, the truckload, trailer load — whatever,” says Dirnbeck.
He says the pallets usually display well-known products on the outside, and will often contain more “junk” on the inside.
Watch | Marketplace buys three skids of Amazon returns from an online liquidator:
While Dirnbeck attempts to sell or donate as many products as possible, he worries about how much ends up in landfills.
Lyons, the Rutgers professor, thinks Amazon needs to be more transparent with its customers.
“So you don’t get a sale price or you don’t get a receipt for it, but the earth is actually paying the price for this,” he says. “”If you think about the millions and sometimes billions of transactions that are happening on this space, the impact is incredible.”
It’s a problem that plagues all e-commerce giants, not just Amazon.
Amazon, however, did write the playbook on free returns, says Jason Goldberg, chief commerce strategy officer at Publicis Groupe, a global marketing and advertising agency.
The tactic of enticing customers to buy more than they need and return what they don’t want “has had tragic repercussions for the environment and business,” he says.
“It’s very difficult and expensive to effectively process product returns” for all e-commerce retailers, says Goldberg. “You’re lucky if half of all returns can still be sold as new, so a huge amount of merchandise has to be dispositioned via some other means — liquidation, refurbishment, recycling, or landfill.”
In Amazon Canada’s business agreement with companies that sell on the site, third-party sellers are given just two options when customers return their product: either pay a fee to have it shipped back to them, or pay Amazon to choose how to dispose of the return by selling, recycling, donating or destroying it.
Until recently, the option to have the item shipped back to the seller was three times more expensive than letting Amazon deal with the return. Amazon tells Marketplace that from Sept. 1, those two fees are now the same.
Amazon’s senior public relations manager Alyssa Bronikowski said in a statement that Marketplace‘s investigation is inconsistent with the company’s findings.
“A vast majority of excess and returned inventory is resold to other customers or liquidators, returned to suppliers, or donated to charitable organizations, depending on the condition of the item,” Bronikowski said. “On occasion we’re unable to resell, donate or recycle products — for safety or hygiene reasons, for example — but we’re working hard to drive the number of times this happens down to zero.”
Marketplace asked Amazon what percentage of its returns are sent to landfill, recycling or for destruction. The company wouldn’t answer.
A television investigation in France exposed that hundreds of thousands of products — both returns and overstock — are being thrown out by Amazon. As a result of public outcry, a new French anti-waste law passed earlier this year will force all retailers including e-giants like Amazon to recycle or donate all returned or unused merchandise.
Shortly after the show aired in 2019, Amazon also introduced a new program in the U.S. and U.K. known as Fulfillment by Amazon Donations, which Amazon says will help sellers send returns directly to charities instead of disposing of them.
No such program exists in Canada.