EPR is Coming. Build for it or Budget for it

Extended producer responsibility (EPR) is no longer theoretical. It’s rolling out, starting with textiles. And the message is simple: if you put product into the market, you’re responsible for where it ends up.

That’s not a sustainability slogan. That’s an operating shift. EPR means accountability for collection, reuse, recycling, reporting, and proof. Not estimates. Not “industry standard.” Proof.

If you're one of the many retailers with a current end-of-life strategy that's a patchwork of liquidation, jobbers, and the occasional donation when someone has time, that won’t hold under regulatory scrutiny. Reverse logistics used to be about clearing space. Under EPR, it’s about traceability and control.

What Changes in Practical Terms

Three things happen immediately:

• End-of-life becomes (more) measurable.
• Disposition rules must be standardized and eventually automated.
• Reporting must withstand audit.

Returns, damages, excess inventory, discontinued SKUs — they all become part of your compliance footprint for the first time.

If your reverse flow is manual, fragmented, or overly dependent on one outlet, you’re exposed.

Compliance Doesn’t Have to Mean Higher Cost

Some retailers love EPR and some hate it. EPR is only expensive and a pain if you ignore it until it’s urgent.

When retailers intentionally design reuse and donation into reverse workflows, they unlock leverage:

• Avoid unnecessary freight and handling.
• Reduce storage needs.
• Capture tax deductions properly.
• Generate clean ESG reporting.
• Protect brand equity.

New technological advancements offer automated, easy solutions for retailers to do the right thing with their excess inventory and at the right cost for them. It sounds impossible, but there is a way if you rethink the entire reverse flow. For example, one such solution enables donate-direct decisions at the point of return instead of after the item comes back to the warehouse or distribution center. This is a huge change to the current flow!

When it comes to warehouse bulk piling up, instead of defaulting to liquidation or destruction, donation software moves those items by the box, pallet or truckload through a structured, trackable donation channel with documentation built in.

This is infrastructure innovation, not just philanthropy.

Textiles are first. They won’t be last. You can bolt compliance onto a messy reverse process later and pay for it. Or you can build it into your operating model now and let regulation validate the discipline you already have.

Return-Less Refunds Feel Efficient, But Could Be Problematic

“Just keep it.”

Also known as return-less refunds, the policy sounds efficient. No shipping label. No processing labor. No warehouse touch.

At a surface level, it can look like savings, but in practice it's likely margin erosion and potentially noncompliant with upcoming EPR regulations.

When return-less refunds become predictable, behavior changes. Customers test the boundaries. Repeat abuse increases. Social media shares the workaround. What started as cost avoidance turns into policy exploitation. Retailers don’t just lose the item, they lose control of returns.

You’re Losing Data, Too

When product never comes back, you lose signal:

• condition insights;
• packaging failures;
• quality patterns; and
• SKU-level return trends.

Retailers spend heavily optimizing forward demand planning and then willingly look away on the reverse side.

Not Everything Should Ship Back — But 'Keep it' Isn’t the Only Option

I’m not arguing that every low-cost item should travel cross-country just to be processed and discarded. In fact, I strongly believe the opposite.

Return-less refunds shouldn’t be the default answer. Smarter alternatives exist.

With what we built at LiquiDonate, eligible returns can be routed directly to local nonprofit partners instead of back to a warehouse. You avoid unnecessary transport while preserving documentation, reporting, and policy control.

For bulk inventory sitting idle in DCs, we provide a structured, trackable path for excess goods to move through compliant donation channels instead of liquidation or destruction.

You still eliminate wasteful freight. You just don’t invite fraud in the process. Small policy decisions compound in retail.

If return-less refunds increase fraud exposure, reduce data integrity, and eliminate recovery pathways, they aren’t efficient.

Disney Petit is a social impact entrepreneur and CEO of LiquiDonate, a software that integrates with any WMS or RMS to match unsellable returns and overstock inventory with nonprofits and schools.