GoKawiilThis story appears in the July 2026 issue of Entrepreneur. Subscribe »
Somewhere out there in Walmart land, on May 27 at 3:18 p.m., a customer returned a Nintendo Switch 2. Maybe the Joy-Con controllers weren’t their vibe. Maybe they spilled juice on it. There could be a million reasons.
But here’s the more urgent question: What happened to that Nintendo Switch next?
The answer is dauntingly complicated. Not to mention, expensive.
For many years, returned merchandise has been a quiet cost of doing business at retailers large and small. What can’t go back on the shelf is often offloaded to liquidators for pennies on the dollar, some of it ending up incinerated or in the landfill. In the past, brands and retailers just tucked that loss into their initial pricing. But as online shopping exploded in the aftermath of the pandemic, and Amazon eased customer hesitation by offering free returns, people started buying things differently. There’s a whole new vocabulary for it, like “bracketing” (when someone orders several sizes at a time to see which one fits and sends back the rest) and “wardrobing” (you buy something, wear it once, then return it).
It’s gotten so bad that people are sending things back as if they’re at an all-you-can-eat buffet in reverse. Nearly one in five online purchases got returned last year. If you look at the value of all that merchandise flowing back to retailers, what we’ve got now is a $1-trillion-a-year problem.
“It hit like a tidal wave,” says Scot Case, who recently served as vice president of corporate social responsibility and sustainability at the National Retail Federation (NRF), the world’s largest retail trade association. “The challenge scaled so rapidly. All of a sudden, everybody’s like, ‘Oh my gosh, we need to fix this.’”
In response, a wave of companies has risen to address the problem. Their names may not be familiar to the average consumer — Optoro, Loop, Redo, ReverseLogix, and Rebel, among others—but they’ve likely managed stuff you returned. They operate in a field called “reverse logistics,” which is exactly what it sounds like: They’re trying to move products back inside retail stores, even though the retail business is designed to move product out to the customer.
One of the most established entrepreneurs in the space, Sender Shamiss, wasn’t surprised by the returns explosion. He has been trying to solve the puzzle of reverse logistics for more than 18 years. His company, ReturnPro, processes and sells about $2.5 billion in retail return value annually and is on track for more than half a billion dollars in revenue this year. And when you understand how he built it, you’ll see just how challenging it is to get a returned Nintendo Switch back into a Walmart — and how much opportunity there is in making it work.
Image Credit: Zohar Lazar
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