In the world of global e-commerce, returns are often considered a standard part of the shopping experience. However, if you’ve ever tried to return a product purchased from a Chinese seller, you may have noticed a trend: sellers rarely ask you to send the item back. Instead, they offer refunds and let you keep the item — or in some cases, simply destroy it.
But why? The answer lies in the numbers.
- Return Shipping Cost vs. Product Value
From a logistics standpoint, the cost to return a low- to mid-value item from the U.S. or Europe back to China often exceeds the value of the product itself.
- Return shipping costs: $20–$50 per item on average
- Product value: Often below $15–$30
- Result: Sellers lose more money accepting returns
Platforms like Shein, AliExpress, and Temu have learned from vast amounts of order and return data that it’s more economical to issue a refund or partial credit rather than pay for return logistics.
- Data-Driven Decisions by Algorithms
Cross-border platforms use big data and AI algorithms to automate refund decisions. These systems weigh:
- Product category
- Order value
- Customer location
- Return shipping estimates
- Past behavior of the buyer
If the model determines that return costs are higher than replacement costs, the platform opts for “keep the item” policies, and sellers are compensated accordingly.
- High Customs Duties on Returns to China
Returning a product to China also re-triggers Chinese import duties, even though the item originated there. The seller would have to pay taxes again, sometimes higher than the product’s retail price.
This makes it economically irrational to accept returned items — especially for mass-produced goods like fashion, gadgets, or home accessories.
- “Keep or Destroy” — A Strategic Choice
Instead of return:
- Some sellers allow customers to keep the item
- Others ask for proof of destruction
- Certain platforms donate unreturned items or sell them as liquidation in local warehouses
All of this is based on cost modeling from millions of transactions and optimized logistics data.
Conclusion
What may seem like generosity or leniency on the seller’s part is, in fact, a calculated strategy powered by big data and economic logic. Cross-border e-commerce is driven by algorithms, and these algorithms have determined one thing clearly:
It’s cheaper to refund than to return.
As global trade continues to evolve, understanding the logic behind return policies is crucial — not just for buyers, but also for sellers navigating rising costs and international tariffs.