Taking returned items from customers is only the beginning of the process. The real difficulties show up after that. Which of the returns can be sold as new, which can be sold as-is, and which can be repaired / refurbished. What if a unit is returned once again? Did the customer return counterfeit? How to detect bad-faith actors (which may be the seller)? Who is to blame for damages? What if the item requires special handling (household chemicals, batteries, etc.)? And how to safely dispose / liquidate inventory while being compliant to all the regulations? And, imagine adding taxes, revenues, fees, on top of all that.
A lot of these questions are very labor-intense. It may be possible to automate some bits here and there, but the complexity is inherent to the problems.
It'd be really hard to imagine a random startup can handle returns half as well. Amazon's regulatory compliance team is probably many times larger than a random average startup. Here the economies of scale is really in favor of the big players.