RETAIL TRADE: Point of No Return

Of all the goods sold in U.S. department stores each year, a round 10% are returned for exchange, credit or refund. Returns not only inconvenience the stores; they help push up costs—and prices.

Women are by far the worst offenders. Last week Manhattan's Jane Engel specialty store, whose well-heeled women customers return up to 20% of their purchases, tried a plan to cut returns. It offered to give its customers a merchandise bonus of 7% on their purchases three times a year, provided that their returns in the previous four months had not exceeded 10%. Jane Engel seemed to be...

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