How do returns work?
So you’ve purchased a brand new phone off eBay or Amazon, and while you like it, you realize that it wasn’t exactly what you were looking for. The screen is too big and the camera is quite bad. You’re £300 out of pocket now, so what do you do?
You return it to the seller/store that you bought it from. Yep, this is the golden age of e-commerce and only shopping. Bought some shoes and even though you’ve chosen the correct size, they’re a bit too tight? No problem, return them. Bought a red iPhone case but then you realized that you wanted the green one? No problem, return the red one and get whatever you want. It’s that simple.
No Quibble Returns
Most (if not all) sellers/stores offer a 14 day (or even 30 day in some cases!) returns period. And what’s nice is that you don’t need to give a reason for your returns. That’s why most people call it “No Quibble Returns”.
Ok, that’s amazing, but what are the downsides of returning products? Well, that depends on a store-by-store basis and their policies. For most online stores, all you have to do is pay the return shipping cost, then you’ll get your money back within 14 days. However, for more expensive items, many stores have a “restocking fee”.
A restocking fee is something that has to be paid by the buyer who returns the product(s). This is paid in addition to the return shipping cost. The seller automatically loses money when you decide to return your product, mostly because that product can no longer be sold as “new”. They usually get resealed and sold as “open box” at a lower cost, let’s say, 10% cheaper than a new, sealed product.
How does it work from a shipping company’s point of view?
Well, product returns are a part of every business. Having a hassle-free return process not only impacts customer relations, but also the ability to easily and quickly process returns internally. This is why most courier companies use return shipping labels. Return shipping labels ensure fast delivery back to the seller, which enables the seller to process refunds back to the customer as fast as possible.
What’s the best option for you, the seller?
There’s no one right answer when it comes to pricing your return shipping, but there are a few standard options you have to choose from.
There are three main ways of return shipping offers:
- Your customer can pay the full cost of the return shipping,
- You can pay the full cost of the return shipping,
- A combination of the two.
We would recommend option 3), it’s a small loss on your end, as a seller, but it looks great from the buyer’s point of view.
If you’re offering free return shipping on all orders, you’re going to want to include a prepaid label in the box or poly bag, because you want to remove as many steps as possible for your customers. This also saves you time, because you won’t need to send something over that could have been automated when you were already packing up their order. The customer also has one less step, because they’re like “I don’t like these pieces, they can just slap the label right on the box and drop it off”.
Another outstanding logistics question: what if someone orders five items, and returns one? Will you be charged for the full cost of shipping five items when your customer returns only one in the same packaging?
If you’re shipping one item back in a big box, it doesn’t matter if there’s five items or just one, because carriers charge by dimensional weight. That’s why a lot of clothing retailers, for example, are using poly bags. If somebody originally had five shirts and they’re returning just one, it’s going to be a smaller size and weight, and you’re going to be charged less for it.
A few tips
Always have a returns shipping policy in place, always. Even if you only offer 14 day returns, it’s more than enough for the buyer to realize that he or she doesn’t want the product anymore. Try to offer 30 day returns if you can, but keep in mind that it could negatively impact your business at some point, as more people could take advantage of that policy, and return an item that has been used for 28 days – not good.
Offering your customers the ability to return their purchases for a full refund is a must. It builds trust, and it makes them much more likely to purchase from you. Seriously, would you buy a product from a website that doesn’t offer returns? I know I wouldn’t. It offers that peace of mind that online shoppers always look for.
When it comes to running an e-commerce business, shipping is a key part of your logistics. Having a solid return shipping strategy in place can help make customers more comfortable buying from you. This will also streamline the process of accepting returns when they happen.