A liberal return policy can cause significant variability in demand observed upstream in the supply chain. When customers are able to return products easily, it leads to fluctuations in inventory levels and reorder rates, thereby creating inconsistent and unpredictable demand patterns for suppliers and manufacturers. This variation is less likely to be caused by techniques such as postponement or stabilization of prices, which are typically used to manage supply chain efficiency and demand predictability, nor is it likely due to small order batching, which generally aims to reduce variability rather than increase it.