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Fast fashion retailer Zalando claims its returns are ‘climate neutral’. Is it true?

Fast fashion retailer Zalando claims its returns are ‘climate neutral’. Is it true?

Europe's largest online fashion retailer Zalando promises a sustainable approach to returns. But the company is deceiving customers, a new investigation reveals.

According to its own figures, the company delivered more than 250 million orders in 2021 alone. Of these, around half were returned.

Zalando advertises that it is becoming a sustainable fashion platform, with a "net positive impact on people and the planet," and that returns and delivery are climate neutral.

On its homepage, the retailer states that 97 per cent of returned clothing is "resold through the Zalando Shop after appropriate inspection as well as careful refurbishment."

The rest is sold in the retailer’s outlets and discount platform or donated to organisations, it claims. Less than 0.05 percent of returns would be destroyed "in exceptional cases" - pollutant contamination or pest infestation, for example.

Does Zalando keep this promise? Investigative journalists tracked some Zalando returns to find out.

How did investigative researchers track Zalando’s returns process?

In August 2022, reporters from German TV channel SWR, weekly newspaper Die Zeit and research platform Flip ordered 10 clothing items from Zalando.

They sewed trackers into the items, then sent them back to Zalando. At 57 grams, the GPS transmitters weigh roughly the same as a hen's egg. For smaller items, like a bikini top, 12g Bluetooth trackers were used.

For months, the journalists followed the routes of the trackers. They have now discovered that some of the returned items took very long journeys across Europe.

What really happens to the items you return to Zalando?

The investigators tracked a grey baby onesie to Gardno in northwest Poland. The small village is home to a logistics service provider employed by Zalando to handle returns.

One reason for sending items to Poland could be to circumvent a German law introduced in 2018 prohibiting the destruction of new goods and returns. Shortly after the law was passed, Zalando started outsourcing some of its returns department abroad, Flip reports.

To find out more, the researchers obtained internal documents and spoke to current and former employees at the returns centre.

One worker claimed that they are required to sort 68 pieces of clothing per hour. This gives workers little time to determine the state of the returned items before sorting them into piles based on their condition. Logistics provider Fiege confirms that there is time recording, but disputes the requirement of 68 items per hour.

According to workers in Gardno, soiled items and new goods that are missing a barcode are deposited into a shredder. The shredded textiles are then thought to be handled by a Swedish recycling company. Zalando maintains that this only applies to items that have to be destroyed for health reasons.

A 2016 market study by the trade association Händlerbund, which surveyed 856 online retailers, revealed that almost every fifth return contains items that are damaged or worn.

Around 20 million returns end up directly in a waste incineration plant every year, according to a research group at the University of Bamberg.

Are damaged items really resold or donated?

Zalando says some damaged returns are given new life through a repairs service and used clothing sales. But when questioned by the researchers about how successful these projects are, the retailer would not disclose figures.

Many items are returned to the partner retailers who offer their goods in the Zalando shop, which account for around a third of its total turnover. This means Zalando lacks oversight of how the returns are handled. The platform admitted to the investigators that its claim that 97 per cent of items are resold or refurbished does not include items sold by partners, like Vero Moda, adidas and Levi’s.

Some items marked for outlet retail or donation are reportedly sent to external facilities for handling. They are then often sold to dealers outside Europe to avoid retailers selling cut price products in the local market. This means such goods could travel thousands of kilometres to countries in Africa or Asia, where they often end up in landfill.

Zalando admits to working with such wholesalers but says it only partners with those bound by EU law.

However, it is likely that returned garments get lost in a sea of third-party providers, subcontractors and partners employed by Zalando, meaning they lack final oversight.

How far did the returned items travel?

After a stint in Gardno, the baby onesie headed in a north-easterly direction to Gdansk - and then back to Swinemünde, in the far north-west of Poland. From there it was shipped to Malmö in Sweden and then on to Stockholm.

A few days later, it returned to Germany via Denmark. And then back to Poland. From the coast, the onesie took the ship to Sweden again. Its total journey was almost 7,000 kilometres.

In total, the 10 items of returned clothing travelled 28,822 kilometres, with one venturing as far as Chicago, USA.

Why do returned items take zigzag journeys?

Björn Asdecker, a researcher from the University of Bamberg, says the zigzagging journey of the returned items is partly due to ‘predictive analytics’. This system uses an algorithm to speculate on where an item of clothing is most likely to be ordered next. It is used to ensure the fastest possible delivery.

Another explanation could be that returns centres often get full. Items must then be trucked further afield to facilities where there is space to house them. In some cases, the trucks themselves serve as mobile storage space, says Björn.

Although Zalando claims to check the capacity of centres before making deliveries, the investigation reveals that items often still make unnecessary zigzag journeys across the continent, spewing emissions as they go.

What is Zalando’s carbon footprint?

According to Zalando, in 2021 it emitted more than 5.5 million tonnes of CO2 equivalent across its entire value chain. This is more than twice as much as all of Iceland. This figure does not include the emissions from returns handled by its partner brands.

Its ‘climate-neutral returns’ promise relies partly on carbon offsetting schemes, like tree planting, which have been revealed as substandard by Die Zeit.

Since its inception in Berlin in 2008, Zalando has lent on its promise of easy returns - and more recently, guilt-free returns. Today, 50 million customers buy from the fashion retailer, Flip reports. In 2021 alone, sales rose by 30 per cent to over €10 billion.

Read the full investigation here.