It can be a big deal for a company to change its return policy, especially when it negatively affect customers. Take the recent news that the sporting goods chain REI would be changing its ‘no-questions asked’ policy dating back to its 1938 founding to returns only within one year of purchase.
My take on the change: Good for them. They should weed out those customers who just want to exploit their more-than-generous return policy.
But how you handle returns isn’t as simple as the policy you have down in writing. Let me give you a quick example:
I was recently buying furniture for my offices in Miami and saw a shag rug that I fell in love with. I asked if they would allow me to return the rug and wave the restocking fee if I decided it didn’t look right with my office furniture. They were unwilling to accommodate my request, so I left the shag carpet on their showroom floor along with all the furniture I’d picked out. The same day I went down the street to another store and bought $40,000 worth of furniture and two shag rugs.
The lesson: Don’t let your return policies shag your sales.
Here are six key factors to keep in mind when it comes to your return policy:
1. Your return policy isn’t there to make unhappy customers happy. It’s there to increase sales. Your return policy should result in an increase in sales greater than the cost of returns, restocking, and other costs. The return policy is only successful when the sales force or marketing arm is fully trained to professionally sell your customer the right product or service. Then the return policy is used to increase sales.