Enter a $890B Market Through the Back Door

01 /The Concept

Reshop promises shoppers "instant" refunds when they return an item to an online store – before the store has received the goods, and even before the shopper has shipped them.

If the refund goes to a Reshop-issued card, it's immediate. To any other card, it takes a few minutes. To a bank account, one business day.

To enable this, a retailer becomes a Reshop partner and shoppers download the app – which is where they initiate returns and track the status of their refund.

The app also surfaces offers from partner retailers, personalized based on the shopper's purchase history.

Reshop absorbs the risk that the shopper doesn't actually send the item back, or returns it in unacceptable condition – even though Reshop has already paid out the refund.

The mechanism isn't spelled out on the site, but the standard version of this model works as follows: the shopper initiates a return, Reshop immediately pays them back, and the retailer then has a defined window to receive the returned item and reimburse Reshop – plus a fee on top. If the goods don't come back within that window, the retailer owes nothing. Reshop carries the loss.

Seen from the retailer's side, this amounts to a short-term credit facility. The retailer can keep its cash circulating rather than immediately paying out refunds – and Reshop earns its fee for that float.

There's an upside for the retailer beyond the financing: a shopper who got their money back instantly might turn around and spend it again in the same store – especially if the app shows them something relevant while they're checking on their refund.

Reshop has been operating since 2020, has existing clients, and just raised the largest round in its history: $17M. Prior to this round, total funding was approximately $3M.

02 /Why It Matters

Interest in this category is building as return volumes keep rising. In 2024, returns were projected at roughly 17% of all retail sales – online and offline combined – amounting to a staggering $890B. That's up from 15% in 2023.

Full-year numbers aren't in yet, but holiday-season return rates jumped to 28% – well above projections.

Several dynamics are driving this. About two-thirds of online shoppers buy multiple sizes or colors of the same item with the intention of returning what doesn't work. Around 70% of shoppers admit to buying items for a single occasion – a party, a photoshoot, a trip – and returning them afterward. That behavior is up nearly 40% year-over-year.

As a result, roughly half of all shoppers now return purchases multiple times a month – a figure that's grown by about a third compared to the previous year.

Return behavior is becoming a generational habit. 76% of shoppers say free returns are a prerequisite for even considering shopping at a given retailer. 67% say problems with returns – including delays – are a deal-breaker for future purchases at that store.

For retailers, even getting the goods back costs money: on average, 30% of the item's value in direct and indirect costs, including processing, restoration, resale discounting, and the cost of tying up cash in the return float.

In response, 83% of US retailers have tightened return policies – including charging for returns. But that backfires: it alienates the customers for whom frictionless returns are non-negotiable, damaging the loyalty they were trying to preserve.

Services like Reshop let retailers maintain a good shopper experience while at least not immediately pulling cash from their working capital to fund returns.

Refundid ([related review](/review/kak-budto-srazu-no-potom)), which launched the same year as Reshop, operates the same model in Australia and has raised $14.2M, including $12M raised after its initial review.

Reversso ([related review](/review/kak-ne-vozvrashhat-poluchennye-dengi)) takes a different approach – a Chilean startup that tries to intercept the return decision and offer shoppers an exchange for a different item from the same store instead of a cash refund. It raised $1.1M.

Loop Returns ([related review](/review/1-5-rynka-ne-prodazhi-a-naoborot)) provides the most comprehensive platform in the category, including exchange functionality and an option for shoppers to buy "free return insurance" for a small upcharge at checkout. Its breadth has helped it raise $125.5M.

03 /Opportunities

The general direction is clear: build platforms and solutions that reduce the operational burden and financial losses retailers face from merchandise returns.

The approaches listed above don't exhaust the options. A [previous piece](/review/kogda-rynok-bolshoj-nuzhna-pravilnaja-biznes-model) covered (Re)vive, which takes returned items off the retailer's hands entirely – restoring them and either returning them to stock or listing them on secondhand marketplaces. The retailer never needs to touch the goods.

If return behavior is becoming a genuine generational habit, return volumes will keep growing regardless of how aggressively retailers try to discourage them.

At 17% of total retail – and nearly 30% during peak periods – returns represent a massive and growing slice of the market. Entering that market, in the right way with the right model, means competing for a share of something that compounds as retail itself compounds.

The only real decision is which business model fits both what you want to build and what the market is ready to pay for.