Online shopping has made returns an expected part of the retail experience—but for businesses, what comes back can be just as important as what goes out. In this episode of Mailin’ It, Karla Kirby and Jeff Marino talk with Nagee Jackson, Director of New Business Acquisition at the U.S. Postal Service, about the business of returns and reverse logistics. Nagee explains why retailers should view returns as part of the customer experience, how return policies can affect customer loyalty and profitability, and why there’s no one-size-fits-all approach.
Returns have become a defining part of online shopping, with U.S. retail returns reaching an estimated $849.9 billion in 2025. In this episode of Mailin’ It, Karla Kirby and Jeff Marino explore how retailers can move beyond viewing returns as simply a cost and instead make them a strategic part of the customer experience.
Nagee Jackson, Director of New Business Acquisition at the U.S. Postal Service, explains why an effective returns strategy starts with understanding customer expectations, product value, return rates and the true cost of bringing merchandise back. He discusses how different products—from clothing and perishables to collectibles and electronics—can require very different approaches.
The conversation also examines USPS return solutions, including Ground Advantage, Priority Mail Return and scan-based returns, which can help businesses align costs with actual return activity. Nagee emphasizes the importance of planning ahead for peak season, analyzing historical return data, establishing clear policies and preparing for the physical volume of merchandise coming back.
For consumers, the episode offers practical advice on what to look for in a retailer’s return policy, including return windows, shipping costs and return methods.
The episode concludes with a look at how USPS sales teams can work directly with businesses to develop customized shipping and returns strategies. In the “Did You Know?” segment, Karla and Jeff highlight John Wanamaker, the pioneering retailer and former Postmaster General whose innovations helped shape both American retail and the Postal Service.
Karla Kirby:
Hello, and welcome to Mail Init, the official podcast of the United States Postal Service. I'm Karla Kirby.
Jeff Marino:
And I'm Jeff Marino. Karla, you know, if you shopped online in the last few years, you're aware that free returns are kind of an expectation now.
Karla Kirby:
They absolutely are, but what a lot of people probably don't realize is that returns and reverse logistics are actually a huge challenge for businesses and retailers in particular.
Jeff Marino:
That's right. And they get especially challenging this time of year as we head into the holiday season. But here's the thing though, returns don't have to be a cost that retailers just absorb in order to compete. With the right planning, they can be turned into a competitive advantage.
Karla Kirby:
And so, Jeff, that's why we're talking to Nagee Jackson today. Nagee is the Director of New Business Acquisition at the Postal Service, and he works with some of the nation's largest retailers to help them design return strategies that work. Nagee, welcome to Mailin’ It.
Nagee Jackson:
Karla, I'm excited to be here. Returns are one of those areas that every retailer has to deal with, so when they're planning the right way, they can become much more than an operational necessity.
Jeff Marino:
Well, we're glad to have you here, Nagee. So let's start with the big picture. For someone who's listening to this podcast who runs a business, why should they be thinking strategically about returns right now with the peak season coming up?
Nagee Jackson:
Yes. The first thing I'd say is that returns aren't just a shipping conversation. They're customer experience conversation. So the way a business handles a return can have a direct impact on whether that customer comes back and buys again. Every customer doesn't have the same expectation though. Some want an exchange, some want a refund, and increasingly consumers are looking for a convenient way or a free return experience. So businesses have to understand what their customers expect and then build a strategy that makes sense economically. So that's especially important going into peak because higher sales volumes can ultimately mean higher return volume. Planning ahead gives a business an opportunity to manage those costs too, and it gives them the opportunity to protect their margin and still deliver a strong experience. The strategy is going to look different depending on what you sell, whether it's apparel, perishables, and electronics, but they create very different return considerations.
Karla Kirby:
So it's my understanding, Nagee, that some retailers take a hit on returns, meaning they lose money on that transaction. Why would any business do that?
Nagee Jackson:
Sometimes taking a hit is actually the better business decision. So you have to look at the cost of bringing the product back, the value of that product, and then whether you can realistically resell it. So for example, if, if there's a relatively inexpensive shirt, a retailer may determine that it's cheaper to send the customer replacement and let them keep the original then to pay, to bring it back. So if perishables like fresh food or, for example, a cheesecake, physically returning the product may not even be an option, but if we're talking about something like a $10 commemorative coin, that return transportation cost could outweigh the value that you're recovering. So the goal isn't to force every product back. The goal is to have a deliberate policy, understand the economics behind it, and make the policy clear to the customer before they buy.
Jeff Marino:
So speaking of economics, what kind of numbers are we actually talking about? For example, how big is the returns market in reality?
Nagee Jackson:
Significant. The figures outline show about $849.9 billion in US retail returns in 2025. And online returns are especially important. About 19.3% of online sales are returned compared with roughly five to 9% in brick and mortar retail. So we also know that free returns matter to consumers with 82% saying they're important when shopping online. So this isn't a temporary issue that's going away. Returns are essentially a part of today's retail environment, and businesses need to treat them as a strategic part of the customer journey rather than an afterthought.
Karla Kirby:
So Nagee, when a retailer sits down with you to talk about returns, what options does the postal service put on the table?
Nagee Jackson:
We look at several services, and it depends on what the customer's trying to accomplish. Priority mail return is the faster option, so that's generally one to three days, and including tracking. Ground advantages generally two to five days also includes tracking and is typically the more economical option. We also have a parcel return service, which is another, but it's more of a legacy option. So where the conversation really gets valuable is matching the service to the actual business need. For a one pound return, for example, the outline uses a typical range of about five to six dollars for ground advantage versus nine to $10 for a priority mail. And that one package, that difference may not seem huge, but at scale, three or four dollars per package can have a major impact. And that's why most retailers don't necessarily need the fastest service on every return.
If speed isn't creating additional business value, ground advantage can be a very, very, very strong fit. And for something generally time sensitive, the equation may be different and may look at a return service like priority mail.
Jeff Marino:
Interesting. So retailers that are really concerned about the cost of returns tend to go to ground advantage. Cool. But how does the actual process work? Do businesses prepay for every return label or is there some other smarter way to do this?
Nagee Jackson:
And that's a great question because this is an area where businesses can sometimes find meaningful, meaningful efficiency. So with the traditional prepaid approach, a business can end up paying for a return label whether or not the customer actually uses it. My preference is the scam-based returns method, which the retailers can include the return label, but the charge occurs when that return actually enters a USPS network and is scanned. So you're really aligning the expense within actual return. And at scale, that really matters. It can reduce unnecessary costs, it can improve visibility, and help protect your margin. It can also be implemented through third-party shipping platforms or printed label workflows. So a lot of businesses simply aren't aware that this type of option exists, so it's worth having the conversation before defaulting to the prepaid model.
Karla Kirby:
So that's a pretty big difference. Scan-based seems like the obvious choice, but I'm guessing that's not the right choice for everyone.
Nagee Jackson:
Correct. A lot of it comes down to awareness. Businesses may - may be using the platform or following the same process they've always used without realizing there may be another option available. And that's one of the, one of the reasons I encourage businesses to engage with our USPS sales teams, because our value isn't just saying, "Here's a USPS product." It's help - it's really to help a customer understand the different levers available and gen - and then looking at how those levers fit their operation, their volume, their customer expectations, and overall their cost objectives.
Jeff Marino:
Okay. Let's shift gears a little bit and talk about the shipping industry for a minute. You know, our largest competitors have really, really big returns operations. So what does USPS offer that differentiates us, especially for smaller and mid-size retailers?
Nagee Jackson:
Yeah. One of the biggest advantages is the reach of the USPS network. We serve almost every address in America, including rural areas, and our postal net- network gives consumers convenient access points for returns. That convenience matters because the return experience doesn't begin when the package reaches the retailer. It essentially begins when the consumer is trying to figure out how easy is it to send it, this item back. So the cost is another important part of that conversation, because USPS can be especially competitive for lighter weight packages from ounces up through roughly 10 pounds. And for retailers, that's a focus really heavily on controlling return costs and don't require premium speed on every package, which can create real value. So they don't have to give up visibility to get that value, and Ground Advantage returns, including tracking and scan-based returns can provide visibility while avoiding unnecessary prepayment.
Karla Kirby:
So from a consumer perspective, if someone's returning something through the postal service, what is the best way to do it?
Nagee Jackson:
Yeah. If you already have the return label, taking a package to your local post office is a very and you can have it and get a receipt as proof of the drop-off, which gives you them that immediate confirmation. A collection box can also work when the package and label are eligible and ready to go, but the main idea is to get the return properly entered into the postal network as efficiently as possible. For businesses, making those instructions simple and clear for the customer helps remove friction from the entire return experience.
Karla Kirby:
So we've talked a little earlier about how the winter holiday season is fast approaching. If a retailer is listening and thinking, "Okay, I need a returns plan in place before the holidays," what should they be doing right now?
Nagee Jackson:
Ideally, peak planning starts well before peak. Many retailers are finalizing plans by early September and even August. And then the carrier conversations can start as early as May or June. So if a business hasn't started yet, the important thing is to move quickly and really be intentional. And that starts with data. With return volume. What return volume does expect you to do is really be elaborate on your history, then determine what service level you actually need. So does every return need priority speed or can Ground Advantage meet the businesses need at that lower cost? Looking at whether scan-based returns make sense, make sure that the return policy is clear to customers and make sure the operation is ready for the physical volume coming back. And that last part can be underestimated because during peak, returns can arrive at significant scales that outline.
And that outline gives an example of 40 pallets, right? Just for an example. You don't want the first time you're thinking about the volume to be when it's already arriving at your facility.
Jeff Marino:
So what if a retailer has never done returns before and they realize the peak season's coming up now? Is there a quick way to get this all set up with the postal service?
Nagee Jackson:
Yes. A business can certainly take a do-it-yourself route, but to set up an account online, even walk through a third, third party platform. The challenge though is that you may not know every option that's available to you, so you could be leaving value on the table. The better opportunity is to gauge, engage USPS sales support and let us look at the business with you. And that cons- consultation is about understanding your shipping profile, outbound, and returns, and identifying where they may, there may be opportunities to improve. So when we look at a package level detail such as weight zone, cubic opportunities, and also flat rate options, we can talk through the trade-off between cost and speed and identify areas where the business may be overspending and help with options such as scan-based returns. And an important point for customers is that USPS sales representatives, representatives are not commission-based.
So the conversation is about finding a postal solution that makes sense for the business, not simply trying to push a particular service.
Karla Kirby:
So Nagee, based on your experience, why don't more businesses take advantage of these services?
Nagee Jackson:
I believe the biggest barrier is awareness. A lot of businesses know USPS through their local post office, but they may not realize that at the corporate level, there are sales professionals who can work with them almost like shipping and postage consultants. And it's particularly important for small and mid-sized businesses that may rely heavily on third-party platforms. And those platforms can be useful, but I still want businesses to understand what USPS can offer directly, including tools such as click and ship and access to people who can analyze the shipping operation with them. So sometimes the biggest opportunity isn't a brand new service, it's simply understanding the options you already have access to and using them more strategically.
Jeff Marino:
Okay, Nagee. So we've talked about different products, we've talked about different sized businesses, we've talked about different ways of returns. Let's talk about some examples, some real world cases and some complexities that are unique to each one of those options. So can you walk us through some examples for like apparel and perishables and collectibles and things like that?
Nagee Jackson:
Absolutely. Because this, this is where you see why there isn't one universal return strategy, right? So let's take apparel to start. Return rates can be high because of sizing, and some consumers practice bracketing, which is ordering multiple sizes with the expectation of returning what doesn't fit. So depending on the product value and the transportation cost, one retailer may require the, the item back while another may decide that sending a replacement and letting the customer keep the original is more economical. When we look at perishables, that's completely different. If you're shipping fresh food or something like a cheesecake, the product generally can't simply come back into inventory, right? So the business may need a non-returnable policy or may issue a refund without requiring a physical return. So you have to consider the lower value collectibles or memorabilia. If the item is worth $10, spending a meaningful portion of that value just to transport it back may not make economic sense.
So the point is that the return policy should follow the economics and characteristics of the product, not a one-size-fits-all rule.
Jeff Marino:
So we've talked about a couple examples. Let's touch on electronics. A lot of electronics get sold online these days. Do companies have different types of return policies for that?
Nagee Jackson:
Absolutely, they can. Particularly when you're dealing with products that contain lithium batteries, for example. A laptop is a great example. Those packages can have hazardous material requirements, which may need to travel by ground and require the appropriate labeling. The return process has to account for that as well. If the customer isn't given clear instructions and a package isn't prepared or labeled correctly, that can create delays, postage issues, or a hazmat compliance problem. So for electronics, a good return strategy isn't just about price and speed. It's also about making the process as clear and foolproof in a sense as possible for the consumer so that the item comes back through the network correctly.
Karla Kirby:
So basically, every product category is different and there isn't necessarily a one size fits all return strategy.
Nagee Jackson:
Exactly. And that's really, that's really why having a conversation with our sales team matters. The right answer depends on what you're shipping, the value of that product, the weight, the customer's expectations, how quickly you need the inventory back, and what happens to that product once it returns. So our job is to help businesses look and think through those variables and just build a solution around the business model rather than forcing the business model into one generic return process.
Karla Kirby:
From a consumer's perspective, what should people look for in a return policy before buying from an online retailer?
Nagee Jackson:
Yeah. One, one thing I would say to look at first is clarity. Before you buy, find a retailer's return policy and understand what you're agreeing to, because you can return an item and, you know, if you simply don't like it, how long is the return window? 30 days, 60 days, or something else? Who pays for that return shipping, right? Does a retailer send a replacement before receiving an original item? Or, and what carrier or, or return method will be expected to use? So those details are part of making an informed purchase. And then from the retailer side, a return policy that's easy to find and easy to understand can also help build trust and customer loyalty.
Jeff Marino:
When we started this conversation, we were really kind of touching on the timing of it because of peak seasons approaching, but honestly, peak season and returns don't stop in January. How do retailers think about returns as a year-round strategy?
Nagee Jackson:
Absolutely. You hit on a key point. Returns are a year-round part of the business, right? Peak just magnifies the volume. The best system is one that works consistently through the year, right? A clear policy, an efficient process, and a regular way to look at the data. Businesses should track return rates and costs, review what they're learning, and then they have to make adjustments over time. So I would encourage retailers not to think of returns only as a problem or a cost center. A return is another interaction with your customer. You have to make that interaction simple, predictable, and convenient because you have an opportunity to protect the relationship and earn the next purchase. So that's where reverse logistics comes, you know, part of this customer experience and where USPS can help businesses build a smarter strategy around it.
Jeff Marino:
So you mentioned reverse logistics, and I wanna ask you, how is the postal service set up to do returns? Like, do we do anything different for a return or is that treated just like any other normal shipment?
Nagee Jackson:
Yeah, it's, it's treated like any normal shipment, right? Yeah. The, the customer leverages and they. Obviously it's. They have, in a lot of ways, an outbound solution, and we're really just trying to figure out ways to make sure that the customer gets a great experience from USPS, but also their customers have a great experience with them because it's a trickle down effect to where the support is there. We just have to make sure that it's aligned with the business's model, and then also giving the customer experience on both ends, the great opportunity to continue to thrive in a very clear and very predictable and understandable returns process.
Jeff Marino:
So the postal service treats a return the same as a shipment going out to the customer in the first place.
Karla Kirby:
It's an item going into the mail stream.
Jeff Marino:
Exactly. So Nagee, we talked about a couple categories of mail and returns. Can you talk about some success stories? Are there any examples that you can kind of relate to us that show how the postal service sales team has come up with a solution for a customer that's really met their needs? Maybe talk about the results of that.
Nagee Jackson:
Yeah, absolutely. And you know, I definitely have. I can speak to one example, and it's very unique, right, because you also have, in the returns arena, you could also have a many-to-many strategy, you can have a many to one strategy. But when, , you know, when we start to. We had an example to where we worked with the customer that had and needed two different solutions that was gonna be able to fit their business because they had different, , distribution point, excuse me, distribution points that the, , products that needed to go. So we have to build out strategies, and, and one thing I would definitely say that I definitely want to bring awareness to is that we can have customizable strategies based on your business model. So even if it's new for us, we're innovating to make sure that we can definitely be a trusted partner for customers, and that's why I really wanna bring awareness to our return - to our sales team, because these are subject matter experts to go in and help your businesses design a customizable solution that works for them. So when we do look at the aspect of making sure that we align with USPS capabilities are, and also what the, , customers that we do work with capabilities are, we try to match that alignment and make sure that any customer solution and also feedback from customers is ve- very valuable because that's how we are able to innovate and continue to build a, a more efficient model.
Karla Kirby:
So Nagee, we've talked about the products, we've talked about the importance of meeting with, , a sales professional. How do consumers and/or retailers reach out to the sales department? How can they schedule their consultation?
Nagee Jackson:
Yes. It's simply, , USPS.com, we do have an opportunity to where they can go and access and request a sales support team member. And that's generally the first option, I would say, if there is already no interaction. , The second piece of it is, is to, , in, in some way, a lot of businesses use us into a capacity, right? Whether it's, you know, whether it's mail or direct mail, or whether they have shipped with us before, we are designed to also have our sales rep reach out and seek opportunity. We do have a regional sales team that are locally. That are local to customers, and we also have strategic and strategy sales team that, more at a high level, can also help customers. So to get access to us is not hard because you can go through usps.com and, , request a, request a call, and then that will get pointed to the right, , sales support team that fits your business need.
Karla Kirby:
Can I walk into my local post office and get in contact with somebody from sales?
Nagee Jackson:
We, we definitely do. We actually have an internal communication strategy to, if you did go into, walk into the post office and leave your contact information. We have a business, development support team that will then take that information, generate it as if it's a lead to send up to the respective support team that should follow up with that customer.
Karla Kirby:
Well, that is absolutely great to know.
Jeff Marino:
Well, Nagee, super helpful talking to us about this today, and hopefully our audience or business customers got some good information on how to think about returns and where to go if they need more information about to set up a strategy with postal service.
Karla Kirby:
Well, I definitely learned something. I think when we order, we assume we're gonna keep it, but looking at the return policy can be super helpful.
Nagee Jackson:
Yes, thank you for having me. , And one thing I do wanna share, the biggest takeaway I'd leave with businesses with is this. Don't wait until returns become a pain point to build a strategy. Look at your data, understand what your customer needs, and then understand the true cost of the return. Then that leads you to make sure that the service that you're using matches that need. So if you're not sure where to start, have a conversation with USPS, and there may be opportunities in your current shipping and returns operation that you haven't looked at yet, and we do have that team that can help you identify that.
Karla Kirby:
Thank You for joining us.
Well, it's time for another edition of Did You Know? I'll take this one, Jeff, if you don't mind.
Jeff Marino:
Be my guest.
Karla Kirby:
Today's interesting story is about a man who revolutionized American retail and then turned his ambitions towards the Postal Service. His name was John Wanamaker, and he was the US Postmaster General from 1889 to 1893. But before that, he was known as the father of modern advertising.
Jeff Marino:
The father of modern advertising becomes the Postmaster General. Tell me how that happened.
Karla Kirby:
Well, Jeff, Wanamaker started as a clothing store clerk, making about $2.50 a week. He worked his way up, opened his own stores, and basically invented the department store as we know it. He was a pioneer in using full page newspaper ads, window displays, and in-store restaurants to help his businesses.
Jeff Marino:
So how did that success in retail translate to the Postal Service?
Karla Kirby:
Well, as the Postmaster General, Wanamaker pushed for the rural delivery system that would extend mail service to families all across America. It was implemented a few years after he left office.
Jeff Marino:
That was a huge improvement. Was there anything else?
Karla Kirby:
He also advocated for the first parcel post system, which began in 1913, and for a postal saving system so Americans could keep their life savings safely at their neighborhood post office. He issued the first commemorative stamps, and he also established over 5,000 new mail routes.
Jeff Marino:
Those are some pretty big accomplishments. We've mentioned all of those innovations on the podcast at least one time or another, and I just never realized they could all be traced back to the same person.
Karla Kirby:
It's amazing what you can learn listening to our podcast.
Jeff Marino:
Indeed, it is.
Karla Kirby:
So, Jeff, I can tell you, I definitely learned something, which is read the return policy.
Jeff Marino:
For sure. I don't do this myself, but one of the things that he said was, staggering to me was that in-store purchase return rates are like five to 9%, whereas online, it's 19% plus. And at first, I was kind of like, "Wow, that's a huge difference." But then I realized that he mentioned that a lot of people bracket their purchases by different sizes of the same thing or different colors of the same thing, knowing they're going to return a certain portion of what they buy. So I guess that makes sense. And, you know, when you can't try something on in a store or touch it and feel it and you're doing that online, I guess it makes sense though. And that, again, leads into that huge returns business of, you know, $850 billion in 2025.
Karla Kirby:
Absolutely. Well, that's all for this episode of Mailin’ It. Don't forget to subscribe to Mailin’ It wherever you get your podcast to make sure you don't miss the next episode, and follow along on Instagram at US Postal Service, x@usps, Facebook, and youtube.com/usps.