UK fashion brands are heavily investing in digital return portals but operating them “with the handbrake on”, a new report by parcelLab warns.

Original research of 147 leading UK fashion retailers in its Fashion Unboxed report showed that, while 91% have digitised reverse logistics, less than a quarter of brands (21%) offer customers automated size or colour swaps on purchases.

It found that over three quarters (78%) of fashion returns portals offer zero exchange functionality which, the report suggests, is forcing shoppers who simply need a different size or colour to request a complete refund and place a new order manually.

Direct size and colour swaps are available in less than 40% of portals, while incentivised exchanges, offering perks like extra store credit to encourage product swaps, remain virtually non-existent (1%).

“Most UK fashion brands have returns portals now, but a lot of them are only doing half the job,” said Angus Knights, Director of Product Vision and Strategy at parcelLab.

“When over 43% of portals are really just label generators and more than half don’t let you swap for a different size, shoppers are essentially being told to take a refund and start all over again.“

“That means the sale you’ve already won is at risk of being lost altogether,” Knights added.

According to the study, two thirds (67%) of the UK’s fashion retailers are missing out on revenue retention opportunities by handing their return labels and shipping processes to third-party couriers.

Alongside the 43% of UK fashion retailers that rely on static “label-only” portals, which merely collect return reasons and generate shipping labels, these brands treat returns strictly as a logistics cost centre rather than an opportunity to preserve sales.

Knights said retailers needed to “treat a return as a chance to keep the sale, not just as a parcel for processing” as well as offering shoppers a “reason to choose credit.”