1) What are eCommerce Returns?
eCommerce Returns come into play when your business is approached by customers who would like to return an item they had purchased or someone had purchased on their behalf. In these circumstances, the eCommerce Returns Policy, a treaty of sorts, helps you analyze the factors involved in the return request and guides you towards a well-considered decision. The return process of your eCommerce store involves numerous departments, the leading being logistics, customer care & support, and inventory management.
2) How do eCommerce businesses handle Returns?
The process of eCommerce returns has a well-structured flow of events. Once the customer places a request for a return or a refund, your business will decide if the product is eligible for return based on your store’s eCommerce Return Policy.
If approved, you can accept the return via your own logistics team or third-party logistics providers, or the customer can ship it to you or drop it off at your store. The returned product will need to hold up to the scrutiny of your quality inspection department, passing which it will return to your store’s warehouse.
If it fails the inspection, it will be considered for repair and restock or the disposal pile. Although the returns process is quite simple, it can be costly due to the workforce and time each returned product demands.
3) What is a typical eCommerce Return Policy?
A typical eCommerce Return Policy is a concise list of rules and requirements written in non-legalese, i.e. following normal speech patterns. Rather than a predominantly legal agreement, the Return Policy helps businesses and customers ascertain whether return requests are valid or not, to begin with.
The system for Return Merchandise Authorization, or the RMA, lets your eCommerce store request your customer for validation paperwork and product images. By reviewing this information, you can process the request for approval or deny the return. This system also allows the generation of return labels that you can share with your customer. When customers request a return through the RMS, they can either request store credit, exchange, or refund.
One of the main requirements of an eCommerce Return Policy is to have a clear time frame from the date of purchase within which a return request will be entertained. While most stores offer a 30 day period, others can offer anywhere between a couple of days to three months, depending on the product category or business type. It is crucial that this cause is presented to the customer, without which you could potentially receive used or damaged products after a lengthy time period.
Another requirement of the eCommerce Return Policy is to outline the conditions that a product will have to meet in order for your business to process returns and refunds. One common requirement that is presented by businesses in the eCommerce Returns Policy is that the product needs to be returned along with its original packaging. While for some products, this may mean stickers and boxes, for others this may mean tags. Some businesses may only accept unopened packages. So it is critical that you state what packaging rules entail in your line of business.
Clearly state to the customers in your eCommerce Returns Policy, all the paperwork, bills and related data you would require in order for the product to be eligible for return. This could cover the receipt of purchase, any customer order or authorization number etc.
3.4) Cost of Returns
In case your customer will have to bear the cost of returns, make sure this is clearly stated in your eCommerce Returns Policy. By being transparent and upfront about splitting the bill, you can avoid raking in negative reviews later.
3.5) Refund Type
While some businesses only offer in-store credit, others may offer a full refund. The best way to hit the high notes in customer satisfaction is by providing a full refund if they meet your eCommerce business’ Returns Policy.
4) Three reasons your business needs an eCommerce Returns Policy
While it is impossible to stress enough the importance an eCommerce Returns Policy holds for your business, here are the three top reasons you need to have one that works for your business.
4.1) Customer Retention
If your customers experience a hassle-free return with your business, chances are they will shop with you again. Easing the return process for your customer ensure you build customer loyalty through a blemish-free shopping experience.
4.2) Increase Profitability
Your eCommerce Returns Policy helps you understand which of your products experience the highest returns and why. By categorizing product feedback into analyzable data such as return type, return reason, sourced from etc., you can control your inventory planning, sort out manufacturing defects and troubleshoot warehousing issues.
4.3) Brand Perception
The relationship between brand perception and your eCommerce Returns Policy is quite simple. Customers who have positive experiences with your store are more likely to recommend your business and products to others. A positive return experience with your store will lead to superior customer retention numbers. Customer retention is always a better game to focus on than that of customer acquisition, at a fraction of the cost. Loyal customers plus a convenient shopping experience equals positive brand perception.
5) What are the items not covered by the eCommerce Returns Policy?
While most products can be returned and processed for refunds by your business, some items fall under the non-returnable category. This list is generated in accordance with state and federal safety guidelines for the benefit of customers, retailers and suppliers.
Other items that fall under the discounted or not eligible for return category as specified by stores, especially during discount, event or clearance sales, would also come under non-returnables.
The following items are generally not permissible for return.
- Skin & Nail Care
- Grooming & Massage
- Supplements & Vitamins
- Medical & Dental Supplies
- Sunscreens and Repellants
- Intimatewear & Swimwear
- Edible products
- Plants & Flowers
- Final Sale products
- Gift Card
- Safety Products
- Gym Supporters
- Baby Care
- Software & Video Games
6) Ten best practices for Your ECommerce Returns and Refunds Policy
A customer’s sales experience with your store has the same impact on them as their returns experience. With the Service Recovery Paradox, you have the potential to increase customer loyalty. SRP is a circumstance when customers have a higher regard for your company after you resolve a mistake rather than if you provided faultless service. When easy returns are a significant part of your customer’s definition of a positive shopping experience, making returns simple needs to be your goal.
6.1) Easy to Find
Make your eCommerce Returns Policy easy to find, easy to read and clearly and concisely laid out. Include any relevant hyperlinks to help make navigation smooth.
When customers can immediately process the information in your eCommerce Returns Policy, it negates the frustration they would experience reading lengthy legalese. Easy to find and clear instructions simplify returns and increase sales.
6.2) Clear Deadlines
Make sure your deadlines are bold and proud. Do not hide or sink them into the fine print of your eCommerce Return Policy. In fact, something as straight forward and mutually beneficial as an eCommerce Return Policy should not have fine print.
State the time period within which a return request is acceptable to you. Make sure you choose a time frame that works for you and your product.
6.3) Via Shipment or In-Store
If you do have a store, you can choose to give the customers the option of shipping the returns to you or drop it off at your store. Having a customer return their purchase at a physical store increases the chance of an upsell. Your customer will likely purchase another product when they visit your store to drop off their return.
In this way, you even have the opportunity to listen to their product feedback and show them a range of products better suited to their needs.
6.4) Easy Return Labels
Ensure your return labels are easy to find and easy to print. Your customers should be able to see their order history and select items for return. With a click of a button, they should be able to generate a return label for their package.
For quick turnarounds in your business, fast returns are a must. Products that are returned quicker will often be in a better condition to stock for resale. An innovative add-on to the return labels would be a pick list for the customer with a list of items such as proof of purchase and product tags that are required to meet the return eligibility criteria.
6.5) Free Return Shipping
An expensive process, the cost of returns can quickly build up and sucker-punch your bottom line. But then again, customers are not willing to shell out for returns. Free returns attract customers like no discount sale will. If you insist on making customers pay for returns, you will pay the price for it in customer loyalty.
If return logistics is just a little too expensive for you right now, consider offering customers a low flat shipping rate for returns just to help your costs a little. Or, consider adding a late fee for delayed returns and only offer free returns for products that are returned within 48 hours.
6.6) Understand Return Laws
According to the consumer laws of several countries, returns are a prerogative. There may be further rules outlined regarding the time frame and monetary value of purchases and any state laws that could append to your existing eCommerce Policy.
Make sure you ready up on all current laws relating to the process of returns so you don’t get one-upped by the customer.
6.7) Watch Profit Margins
Returns can quickly add up and negate your profit margins. For this reason, most stores do not allow returns on discounted products. And always plan your product price to include the cost of overheads and returns.
6.8) Review and Update
The rules of eCommerce are constantly changing and your eCommerce Return Policy should acknowledge and reflect these changes. Ensure you keep your strategy and policy-relevant to you and your customer. By analyzing your data, tweak any issues immediately. Remember, the rules on your policy are your own. They can always be amended or reconsidered, within law, to figure out a policy that works better for you.
6.9) Illustrate the Process
Try to limit the textual content of your eCommerce Returns Policy while not shying away from adding all the information that it needs. Pepper your content with illustrated information in the form of graphics and icons so your customers can figure out how your returns work without consuming a bucketload of text.
Illustrations also help you form a connection with your customer. Far more than text, images and their design help you communicate in the language of your brand and offer more meaningful messaging than text ever could.
6.10) Customer Care
While both you and your customer could feel that the process of returns is awkward and embarrassing, it is your job to turn this experience into a positive one. It may be frustrating to look at a returns first thing Monday morning, but never show your customer how you really feel. Instead, take the time to empathize with them and patiently listen to their feedback about the product.
Remember, how you deal with returns will decide the tone of your customer service and set the rate of customer loyalty.
7) FAQ's eCommerce Returns Policy
7.1) What is a good return policy for a small business?
A good eCommerce Return Policy for a small business would detail the time frame within which the return request will be accepted, whether store credit or refund will be offered, if the refund or store credit will be full or partial, how the refund amount will be processed, if exchanges are possible for the same value, any receipt or/and packaging requirements along with the product, and the condition of the product. While these are the basics, they can be edited to add or expand on any relevant field.
7.2) Why do eCommerce websites need Return And Cancellation Policy?
Your eCommerce Website needs a Return and Cancellation Policy to protect itself as well as earn your customer’s trust. Customers generally like to see your return process before they make a purchase. A well-written policy will aid customer retention. Adding fields where the customer can input relevant data helps you understand why the products are getting returned. Having a Return and Cancellation policy on your eCommerce website will help with brand perception.
7.3) Can a business refuse to give a refund?
Your business can refuse a return. However, you are required by law to offer exchanges, repairs or refunds if the product is defective. The return and refund eligibility depends on whether your customer can show you proof of purchase. If they don’t have a receipt, they can offer receipt numbers or credit card statements for evidence. The return also needs to have a significant fault in order to be eligible for a refund. Some exceptions where your business can outright refuse a refund are instances where the customer inspected the product prior to purchase, your store staff had advised the customer on issues with the product, the customer had used the product for an extended period.
7.4) Where do eCommerce returns go?
The subject of an eCommerce returns product’s lifecycle is often quite complicated. Because of the heavy cost incurred in the process, some retailers may trash the goods, especially since most arrive damaged in transit or used. Other businesses may take the product back, service or repair it and stock it for reselling. Quite a few stores even suggest that the customer keeps it and issues a refund which is more convenient than the hassles of even a hassle-free return.