Effectively Handling Retail Refunds and Exchanges: Part One

Returns are an inconvenience for both retailers and consumers.  However, they do happen.  So it makes sense to not only make your returns process as painless as possible, but to also make sure that your retail sales associates have the skills and training required to successfully turn dissatisfied customers into raving fans.  We will examine policies and procedures in this article and then cover how to handle difficult customers in our next post.

Step One: Research the Returns Policies of Leading Companies in Your Sector

There is nothing like a little competitive intelligence for helping you ensure that you are able to foster a reputation for great customer service.  Research the return and exchange policies of leading competitors in the brick and mortar retail as well as the e-commerce spaces.  Focus on the following questions and then plan on meeting or beating them in terms of flexibility, convenience, and ability to execute:

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  Do they take back any and all merchandise?
  
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  What are the time limits for returning merchandise?
  
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  Is a receipt required?
  
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  Is there a restocking fee?
  
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  How do they handle the return of gifts?
  
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  How do they handle exchanges?
  

Step Two: Writing Your Returns Policy

Using the information you gathered in the research process, assemble a returns policy that includes the common – and successful – elements from the policies of other successful retailers and e-tailers.  Remember, the policy must be easy for customers to understand, simple for your retail associates to enforce, and – most critically – fair to the customer.  Here are some elements to include are:

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  Spell out exact terms of acceptable returns, including condition of merchandise, time limit for returns, etc.
  
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  Give the customer explicit instructions on how to return merchandise.
  
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  Give the customer explicit instructions on how to return a gift.
  
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  Give the customer details on the refund procedure.
  
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  Provide the customer with your Company’s contact information.
  
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  Ensure that you comply with any local or state laws governing your products.
  

Step Three: Posting Your Returns Policy

Once you've created your returns policy, make sure that you not only post it in appropriate locations in your store, but that you also include it on the bottom or back side of your receipts.  It is also appropriate to post it on your web-site.  This includes the “FAQ” page and, if you have one, in your shopping cart.

Step Four: Guidelines and Procedures for Your Team Members

A policy is a rule.  It is not an operating plan.  So once you have established your policy you will need to communicate your operational plan for handling refunds and exchanges to your retail staff.  This includes establishing the guidelines they should follow for ensuring the satisfaction of refund customers, how to handle the disbursement of funds, and how to handle the products once they have been received.  While by no means a comprehensive list here are some things to consider:

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  When and how can team members exceed the policy guidelines?  For example, should you implement a “$50 rule” where if the value of the refund is less than $50 the sales representative should just handle the issue
  
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  What is the path for escalating issues?  Does the retail store manager or manager on-duty have to handle all complaints or can anyone do it?
  
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  Does a second approval have to be obtained on a refund or exchange prior to the disbursement of refund money or exchanged merchandise?
  
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  How are returns to the warehouse or vendor handled?
  

One you have developed your plan of action around policies and procedures the next step is to train your retail associates on the proper methods of handling refund and exchange customers.  That includes how to deal with irate customers.  We will cover those topics in the next post.

 

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David Goodwin is the principal at Retail Advocacy Group and Retail Training Services.  With over 30 years experience operating hundreds of retail stores and training thousands of retail sales representatives he and his team are focused on helping retailers improve their sales and operational efficiency so they can grow their revenue and profits.  To learn more about their training and retail operations consulting programs please visit www.retailertrainingservices.com.