Returns, refunds, and exchanges are all a part of doing business.
Customers might be unsatisfied with their order for a number of reasons—it arrived damaged, they ordered the wrong size, or it simply didn't meet their expectations. So they ask for a replacement or their money back.
But without a system for handling these requests, they can eat up a lot of time, energy, and money with hours spent on customer service emails, and spikes in shipping expenses for replacement products, especially after the holidays.
The good news is that it’s never too late to address the problem. With a clearly communicated return policy and the right system in place, returns and exchanges can be transformed from a dreaded aspect of ecommerce into an opportunity that actually generates new profits for your business and increases customer loyalty.
But before we dive into how to write a return policy for your store and implement a system to handle requests, let's talk about why it's so important to get returns and exchanges right.
- How customer returns impact your business
- Setting up a system
- How to write a return policy
- Return policy template
- Where to surface your policy
- Choosing a service to power your process
- Strategies for more profitable returns and exchanges
- Making the most of returns and exchanges
How returns and exchanges impact your business
Getting a return request can be painful both financially and emotionally.
Refunding a customer's order can result in a loss of profitability on orders, and knowing that someone disliked your product can be disheartening for business owners that strongly believe in the benefits of what they sell.
For these reasons, it can be tempting to ignore the reality of returns and exchanges and leave the mounting problem unaddressed.
The pitfalls of a poorly implemented return policy
Over time, however, customer complaints about your return policy can start to filter onto social media, showing up as comments under your ads or even in Google searches about your business. This is where a poorly implemented returns system starts to negatively affect your overall reputation as a business. If bad sentiment about the buying experience starts to spread online, it is likely you will see a drop in conversion rate.
Processing every return manually and dealing with customers on a case-by-case basis can also be expensive for your business operations and exhausting for customer service employees. If the time and expense to process a return or exchange isn’t monitored and optimized, it can even prevent you from scaling your business.
At some point, most businesses will need to figure out a solution for returns and exchanges that benefits themselves and their customers.