About 17 years ago I worked at a company that was clamoring to get products into Costco, when we did I was shocked at the fees they charged us for returns. If they're the gold standard for supplier relations it's a wonder anyone bothers being a supplier.
Why would you assume that Costco returns are due to supplier mistakes?
Costco are legendarily permissive with returns, to extent of things like accepting bare stick-like xmas trees back after xmas, and giving a full refund, but ultimately this is to their advantage in encouraging mindless consumerism (which is also the general American model - no-question-no-fault returns are generally an American thing, not a worldwide one).
Now, a liberal return policy may work out for Costco, and Costco is obviously a high volume hence desirable customer for a supplier, but if Costco is pushing much of the cost of returns back to the supplier, that does change the picture a bit!
Those returned trees don't get sent back to the supplier, they get deducted from a pre-negotiated spoil allowance which is something separate. The supplier returns will be things like badly stacked palettes.
