People Are Scoring Big By Taking Advantage Of Costco's Return Policy

According to Free Privacy Policy, it's important for retailers to have a suitable return policy in order to gain the trust of their shoppers. It also helps to increase sales — a survey by Narvar notes that 49% of consumers "actively check" a store's refund policy before buying anything when shopping online. A good return policy is beneficial to the business implementing it as well; it helps create rules regarding what can and can't be returned as well as track any fraudulent returns.

Unfortunately, policies aren't always fool-proof, and customers with malicious intent still find ways to cheat the system. Per Loss Prevention Media, $428 billion in merchandise is returned each year, and at least $25.3 billion of that is considered fraudulent. Chargebacks911 notes there are many ways fraud can occur in the return process, including returning stolen items, faking receipts, and "receipt switching" — a process where a customer makes a purchase, receives a receipt, and comes back later to present the receipt along with a new item they haven't yet paid for. Although thieves do exist, there are still plenty of people who return items innocently. However, it's likely that a combination of innocent and fraudulent returns alike are helping people score big off of Costco's return policy.

Returned Costco items are being discounted

Recently, a Redditor posted in the subreddit r/Costco about a deal they found online for a $10 air fryer. "When I go to the location to pick it up, it's a small warehouse that buys pallets from returns to various stores but mostly Costco," the post read. As it turns out, these expensive returned items from Costco are often sold at huge discounts you can't find in the store. OP also revealed that many items are taken back to the store for unwarranted reasons. "Costco has too much of a relaxed return policy and people abuse it," they began. "People are crazy and will use items like pots and pans, have a dinner, and the return it to Costco the next day."

Judging by the comment section, many other retailers sell pallets of retuned items as well. "Supposedly this is done at all the large Amazon warehouses. I haven't tracked down how to get knowledge of these sales," one comment read. Others are interested in buying the actual pallets to score new goods or even resell items themselves. "Here in Vegas you can buy pallets of Amazon returns on," one commenter wrote.

Returns — and navigating return policies — are a common part of retail, but at least re-sellers and buyers alike can find ways to benefit off the headache.