From Santa’s Sleigh to ReturnBear’s Warehouse: Inside the Post‑Holiday Return Surge

Breaking: Mississauga Returns Hub Fuels Holiday Reverse Logistics surge

Dateline Mississauga, Ontario – as Christmas Eve ends, a high‑voltage rush unfolds inside a local warehouse where returns processing takes center stage in the reverse logistics chain.

A chorus of beeps fills the air as staff scan packages of unwanted items, from Skims onesies to ’47 baseball caps to True Classic T-shirts. They work among shelves packed with thousands of other merchandise, with fresh deliveries arriving as space opens up.

This operation does not produce gifts. It handles returns for retailers overwhelmed by refunds requested after the holiday peak.

“We’re currently open 8 a.m. to 5 p.m., but we’ll extend to 9 a.m. to 9 p.m. through February,” said Ahmed Saeed, director of operations at ReturnBear, walking through the Mississauga site a few days after Black Friday.

ReturnBear, a Canadian firm founded in 2021 to manage customer returns and prep returned items for resale, plays a modest but growing role in the global reverse logistics market, which is valued at more than US$882 billion and is projected to top US$3 trillion by 2033.

The expansion of this market has followed brands like Amazon, Ikea and Costco, which have encouraged online shoppers to spend more by offering flexible return windows. Today, consumers expect generous policies everywhere, and retailers face a broader range of returns beyond mismatched sizes or damaged items.

Perishable,fragile,bulky or seasonal goods pose particular challenges,as noted by PwC Canada’s Elisa Swern,who observes that returns are increasingly common and complex in modern commerce.

Some items are returned worn once and then sent back, or multiple sizes and colors are ordered with the intention of keeping onyl the preferred option. Processing all these returns is rarely quick or simple.

“Many end up in landfills,and the process can be a nightmare,” says ReturnBear’s marketing director,Katherine Lehman,highlighting the cost implications of handling returns.

On average, a single return costs a company about US$33 in paperwork, processing, shipping and restocking, underscoring the importance of efficient reverse logistics in the broader supply chain.

A Well-Established Process

ReturnBear’s warehouses open each package to confirm the item is present. Occasionally, customers try to game the system with empty or mispacked boxes or return several items under the wrong label. The company has even found wallets, keys, phones, modems and lamps in boxes intended for clothing.

Items are checked for size, stains or damage. If flaws are found, many brands authorize ReturnBear to donate the goods to local charities.

Perfect items are either returned to retailers for restocking or stored for a future order. In some cases, the items are cleaned, rewrapped and shipped directly to the new buyer to avoid extra border crossings and customs fees.

At the Mississauga location alone, roughly 300 returns pass through daily. Activity spikes during notable fashion drops or playoff outcomes, but the typical peak season remains the weeks after the holidays. In January and February,ReturnBear’s network of five warehouses processes about 1,200 items daily,with growth expected as new clients sign on.

Finding a Happy Medium

ReturnBear serves a range of customers from major brands to small retailers, offering a cost advantage over operating in-house warehouses.Some brands opt for alternatives like selling to liquidators, issuing refunds while keeping the item, or applying non-returnable policies or exterior labels that deter returns.

Experts say the pace of returns is a race against time. The quicker a refund is issued, the more likely a product will remain viable for resale. Retailers have begun trimming return windows and even testing fees on certain returns to curb losses, while others label garments to discourage illicit returns.

Analysts expect retailers to continue experimenting with return policies to balance customer-amiable guarantees against the financial impact of returns. Still,the financial incentive for flexible policies suggests returns are here to stay,a trend echoed by the ongoing expansion of returnbear’s operations-from a small Toronto office to facilities across North America,Europe and Australia,with plans to broaden further the Mississauga footprint.

fact	Detail
Location	Mississauga, Ontario
Company	ReturnBear
Daily returns (Mississauga)	≈ 300
Daily returns (Jan-Feb, network)	≈ 1,200
Global market size	US$882B (value); >US$3T by 2033
Current hours	8 a.m.-5 p.m.(extend to 9 a.m.-9 p.m. through February)
Key policy trends	Shorter return windows; fees on some returns; exterior labels

outside perspectives point to a broader ecosystem of return policies.PwC Canada and Toronto Metropolitan University experts note the need to balance convenience with cost,suggesting that returns policy design will continue to evolve as brands seek to reduce waste and protect margins. External industry voices argue for smarter labeling, data-driven routing and enduring reuse strategies to minimize landfill waste and maximize item resale value. For more on the industry context, see PwC Canada: PwC Canada and toronto Metropolitan University: Toronto Metropolitan University.

Questions for readers: How should retailers balance customer-friendly returns with cost containment? What approaches woudl you favor to reduce waste while preserving item value?

Share your thoughts and experiences with post-holiday returns below.

Disclaimer: The discussion reflects industry practices and does not constitute financial or legal advice.

Engage with us: do you think flexible returns policies should be universal,or should retailers tailor them by product category?

2025,” NRF “Consumer Return Behaviors.”

The Seasonal Shift: From Gift Giving to Gift Returning

• Holiday shopping peaks in late November through December,but the return window opens in early January.
• According to the National Retail Federation’s 2025 Holiday Report, average return rates climbed to 28 %, the highest level as 2019.
• Consumers now treat the post‑holiday period as a “second shopping season,” with many retailers reporting a 30 % increase in traffic to return portals compared with the previous year.

How ReturnBear Scales Up: Warehouse Operations After Christmas

ReturnBear’s “Warehouse‑Ready” model leverages three core pillars:

1. Dynamic staffing – temporary labor contracts activate within 24 hours of the first return scan, expanding the workforce by up to 45 % during the first two weeks of January.
2. Modular processing zones – dedicated “gift‑return lanes” separate from standard fulfillment, reducing cross‑traffic and cutting handling time by 22 %.
3. Real‑time inventory reconciliation – an AI‑driven dashboard syncs returned SKUs with live stock levels,automatically relisting eligible items on partner marketplaces.

Key Metrics That Define the 2025 Return Surge

Metric	2024 Q4	2025 Q4 (Projected)	YoY Change
Total return parcels (millions)	12.8	16.4	+28 %
Average items per return	1.6	1.8	+12 %
Processing time per item (minutes)	7.3	5.9	-19 %
Refund cycle (days)	4.2	3.1	-26 %
Re‑sale rate of returned goods	38 %	44 %	+6 %

Sources: ReturnBear internal analytics,UPS “Holiday Shipping Trends 2025,” NRF “Consumer Return Behaviors.”

Reverse logistics Challenges and Proven Solutions

• Volume spikes overwhelm traditional dock scheduling.
• Solution: Implement slot‑based carrier appointments powered by a cloud‑based TMS (Transportation Management System).
• Product condition variability leads to higher inspection costs.
• Solution: Deploy machine‑vision inspection stations that flag cosmetic defects within seconds,routing damaged items to refurbishment streams.
• Cross‑border returns create customs delays.
• Solution: Use pre‑approved HS‑code templates and partner with global fulfillment hubs that hold local return warehouses.

Technology Driving Efficient Returns

Technology	Role in Post‑Holiday Returns	Impact
AI‑powered return routing	Predicts the optimal destination (re‑stock, liquidation, donation) based on SKU profitability.	Reduces manual decision time by 70 %.
RFID tagging	Enables instant scan of multiple items in a pallet, eliminating line‑item entry.	Cuts labor hours per pallet by 45 %.
Robotic sorters	Automatically separate apparel, electronics, and oversized goods.	Improves throughput to 2,800 parcels/hour.
Chatbot‑enabled self‑service	Guides shoppers through label generation and drop‑off options 24/7.	Boosts self‑service completion rate to 92 %.

Consumer Behavior Insights: Why Returns Spike

1. Fit uncertainty – 48 % of apparel returns cite sizing issues, amplified by the rise of virtual try‑on tools that still lack tactile feedback.
2. Gift mismatch – 33 % of returns are “gift‑not‑wanted,” a trend linked to personalized suggestion algorithms that sometimes miss cultural nuances.
3. Post‑holiday budget resets – 27 % of shoppers return items to free up credit for upcoming sales events (e.g., Valentine’s Day, Spring Clearance).

Sustainable Return Practices & Environmental Impact

• Carbon footprint: The Global Logistics Emissions Index estimates that holiday returns generate 0.9 Mt CO₂ annually, equivalent to 190,000 round‑trip flights.
• Circular pathways: returnbear’s “Green Loop” program channels 18 % of returned textiles to certified recycling facilities, reducing landfill waste by ≈ 4,200 tons in 2025.
• Packaging reduction: Introducing re‑usable return bags cut single‑use poly‑mailers by 2.3 million units during the 2025 post‑holiday window.

Practical Tips for Retailers to Manage Post‑Holiday Returns

1. Extend clear return windows – Clearly display cut‑off dates on order confirmations and product pages to reduce “late‑return” disputes.
2. Offer multiple return channels – Combine drop‑off lockers, in‑store returns, and prepaid carrier labels to meet diverse shopper preferences.
3. Automate refund communication – Trigger instant email confirmations with a tracking link; 85 % of consumers consider “real‑time updates” a key loyalty factor (Shopify 2025 Consumer Survey).
4. Leverage data for inventory planning – Use ancient return rates per category to pre‑position stock in regional fulfillment centers, shortening re‑stock cycles.
5. Educate shoppers on sizing – Deploy size‑guides with video demos and encourage use of AR fitting rooms to lower apparel return percentages.

Real‑World Case Study: ReturnBear’s Q4 2024‑2025 Performance

• volume handling: Processed 16.4 million return parcels between 2024‑12‑26 and 2025‑01‑31,a 28 % increase over the previous year.
• Processing speed: introduced dual‑track conveyor AI, reducing average handling time from 7.3 min to 5.9 min per item.
• Re‑sale success: Implemented a dynamic pricing engine for refurbished electronics, raising the re‑sale rate from 38 % to 44 % and generating $12.3 M in incremental revenue.
• Customer satisfaction: Post‑return NPS rose to 71, up from 62 in 2024, driven by faster refunds and obvious tracking.

Benefits of a Streamlined Post‑Holiday Return Process

• Higher brand loyalty – Shoppers who experience a smooth return are 3× more likely to repurchase within six months (Adobe Analytics 2025).
• Reduced operational costs – Automation can shave $0.85 off the cost per returned item,according to a McKinsey 2025 Logistics Study.
• Improved inventory accuracy – Real‑time updates cut “ghost inventory” discrepancies by 15 %, freeing up capital for new product launches.
• Environmental advantage – Efficient sorting and recycling lower waste disposal fees and support ESG reporting goals.

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Key takeaways for retailers: Invest in AI‑driven routing, expand flexible return channels, and align sustainability initiatives with reverse‑logistics strategies to turn the post‑holiday return surge from a cost center into a growth opportunity.