Cost to the companies is usually a lot lower than retail. 1-2-4 is common - $1 to produce, $2 cost to company, $4 to customer. 40% return rate would increase c

Cost to the companies is usually a lot lower than retail. 1-2-4 is common - $1 to produce, $2 cost to company, $4 to customer. 40% return rate would increase cost to the company ~20%, plus operational expenses to process the returns. I think it's even more complex - consumer confidence in return processes probably makes them more likely to buy something in the first place, which reduces overall cost due to scale. So if you reduced consumer confidence, they would buy fewer items, which probably also harms the business (and raises consumer prices because scale is reduced).