Crafting a refund policy might be the last thing on your mind when it comes to any business startup. Sometimes, it can feel like the things to keep track of are endless, but leaving your returns policy to the last minute is not going to help you in the long run. When faced with the challenge, arm yourself with information pertinent to your industry and a little common sense to keep things simple. In the end, the clearer the policy and the more attention you pay to it will help you keep track of costs and even reveal problems before they get out of control.
Always Keep Track of Your Data
First off, anything that can be labeled “Customer Satisfaction Costs,” of which refunds and exchanges certainly count, should never amount to more than two percent of your total sales. This means developing a policy that includes a way of attaching the original order to the customer, and the item being returned. The more information you have on every aspect of your business, the better equipped you are to adapt to changes in the market and increase your profitability. In the past, this has required a receipt or other proof of purchase. In eCommerce, this becomes a little easier as asking for an email address to send the receipt to means you can keep the product, the order, and the customer all connected from the beginning. If a return is ever requested, sending instructions and shipping information to the same email will provide convenience to your buyer as well as provide a natural path of communication to ask for feedback. Reviewing this feedback, and periodically checking the expected amount of returns with the amount you are currently experiencing makes it easier to notice negative trends before they can really impact your bottom line.
Compare Your Policy to the Competition
Some businesses stand out because of their returns policy, and while that doesn’t have to be you, it’s always a good idea to know what your competition is offering. Whether you start with a personalized refund policy generator or a hand-crafted rough draft of what you want to offer, NFIB.com suggests sourcing ideas from competing companies, since return policies aren’t going to be copyrighted or patented. Doing this can also give you further insight into your industry from a customer’s perspective. Knowing what sorts of difficulties they might encounter can lead to changes in your products or services, giving you an edge over the competition. Whether that is a simplified returns process or how you handle the matter of shipping, anything that can differentiate your business is worth looking into.
Display the Return Policy at Point of Sale and Clearly State Exceptions
The most finely crafted return policy in the world cannot do its job if the customer can’t find it. That is why NBIF.com suggests putting your return policy clearly at the point of sale. In typical retail environments, this is often written at the end or on the back of a receipt, but online a clear and obvious link can work just as well. There is no need to clutter the page with information most people would just skim over. Providing a link to a popup or secondary page that breaks down your specific policy may be just the confidence booster a customer needs to complete the purchase.
Keeping these tips in mind and approaching your returns policy with the care it deserves is just another way to come out ahead in the business world.
