Recently, retailers are somehow experiencing a disadvantage in implementing return policy, since they are expensive and time consuming. Returns can be considered a burden for gaining profitable sales. According to the Retail Equation’s analysis of National Retail Federation, returns cost retailers more than $100 billion annually and it is not good for business.
“It’s a big issue, and getting bigger”. “As the volume returns increases, people are going to be clever about figuring out ways to maximize the money”, said Foster Finley, managing partner of consulting firm AlixPartners.
It is somewhat a challenge, considering retailers have different ways and standards for which returns can be restocked and sold again as new, or instead find another sales channels.
In spite of this, there is also a huge advantage of providing a comprehensive return policy, which can be served a powerful asset for retailers. Below are some tips how you can take advantage from your return policies.
Be Clear and Simple.
It is very important to have a clear and simple return policy. Don’t go overwhelmed with complicated jargons as much as possible. Use terms that everyone can understand that will be easier for customers to comprehend and to follow your policy.
Make it easy to find that customers can have access to review your return policy, whether it is stated in the package, on receipts, on customer correspondence, or on your website.
Indeed, when implementing return and refund policies, your brand’s goal is to aim clarity.
Be More Transparent.
State clearly whether the customer can expect to exchange the item, get store credit, or enjoy a cash return. Every retailer has their own preference, however don’t let your customers falsely believe they’ll get a full refund a week or so before you can actually deliver it, and as much as possible, don’t let your customer to pay extra for anything.
Avoid your customers be disappointed by creating vague product descriptions and displaying deceiving product photography. Earning trust towards your customers is highly important in maintaining your consistent profitable sales.
Returns do happen. And if customers are hesitant about a purchase, it means they want to ensure that your product won’t make returning into something difficult.
Be Knowledgeable and Get Serious on Return Fraud
Ensure that all your staff members are well-oriented and are up to date with your return policy laws and procedures so they can assist customers effectively and efficiently; and can anticipate and deal with unexpected fraudsters.
A more relevant concern for retailers are cases like return fraud, which naturally occurs during and after the holiday season.
According to the most recent date of National Retail Federation, return fraud alone is estimated at $3.8 billion, considering that there are still criminals who take advantage of relaxed return policies.
“You need to strike a balance between an approach to returns that is customer-centric and still protects the company” says Jim Brill, UPS reverse logistics marketing manager.
Retailers should consider implementing a restocking fee for expensive products. However, this is less generous, but it would be helpful as a strategy for deterring frauds.
Every retailer has their own sets of return policies and approaches considering the goals and objectives of their business. Providing a comprehensive policy returns and exchanges instils trust and confidence in you as retailer, your business and your products.