Today’s topic is a painful one—your return policy.
As creative people, we hate to think about people not liking our work. And we especially hate to think that people might like our work enough to buy it and then CHANGE THEIR MIND. That is painful. So we protect ourselves by not thinking about it at all until there’s a problem—and then it’s too late.
Your customer is entitled to an item that is well made, of consistent quality and suited to its intended use. You, on the other hand, should be able to rest easy at night that once an item is sold, it STAYS SOLD. It shouldn’t rise like the undead and return to haunt you two years down the road.
To protect yourself and your customers, your return policy should be clearly stated and POSTED in your store, in your booth, on your website/order form and in your catalog.
You can have an extremely lenient policy, or a very strict one. It's up to you. Either way, you cannot enforce your policy if people don’t know about it or claim it was not presented to them when they made their purchase. L.L. Bean used to offer a “no questions asked, EVER” policy years ago, and you could return something after years of use if you were not happy with it. (I’m not sure that’s true anymore!) On the other hand, we bought a vacuum cleaner last year from a local business whose policy was “no returns, exchanges or refunds, no matter what”. Wish we’d noticed that BEFORE we bought the vacuum cleaner from hell..... It’s legal, because those were the conditions of sale established before we decided to buy.
You can make EXCEPTIONS to your policy in favor of the customer, if you choose. But your bottom line is what your policy states. You can say something like, “We reserve the right to refuse the return of items after 60 days blah blah blah....”
(Check with your state’s statutes on such policies. If you don’t have a policy displayed, the state’s statutes will be your only recourse. Consult with a lawyer or your state offices to be sure, as this may differ from state to state.)
I’ve had only one or two retail returns since I’ve been in business, and suffered only a few returns from my wholesale accounts. But the hard economic times of the last three have changed all that. Cash-poor stores look at stock that hasn’t been moving and think, “If I sent that stuff back, I could buy NEW stuff without really spending any money!”
It's an awful feeling not only to see that work coming back, but to spend time making new work that you will not see any more money for. You feel like you are running BACKWARDS.
You can avoid much of this. If you don't have a return policy, take time TODAY to write one. If you already have one, review it and make sure you can still live with it. Close up the holes where your generosity could be abused. A fellow artist was forced to accept a major return on items, some of which he'd even customized, because his return policy was not posted in his store. His policy is now prominently displayed. This is a good time to learn from someone else's mistake!
What should your return policy include?
Well, I’ve learned the hard way to put a time limit on returns. I once had two stores return work that was over three years old. That is no longer acceptable to me, and my policy reflects that.
YOUR polcy may reflect your tolerance, or it could depend on your product. If your work/product dates quickly or your styles change often, you may not want to accept returns after a season (say, accepting summer styles rturned in the fall). Perhaps you simply feel a few months should be enough time for a storeowner to know if an item is going to work for them or not. On the other hand, if your designs are more timeless, and/or you can sell them again easily, then you can allow more time to go by.
Your sympathies may lie with the storeowner on this one--no one likes to realize their purchase isn't a good fit for them. But that is the risk the storeowner takes. And it's one reason why their mark-up is so high, too. They have to take into account that some of their choices aren't going to fly.
On the flip side, a generous return policy can encourage a buyer to take a chance with your work. On the flip/flip side, I'm learning that if they are that ambivalent about your work, then maybe that's a sign you BOTH should hold back.
I’ve learned the hard way that the items must be in condition to be resold. This means damaged items, tarnished jewelry, incomplete items are not returnable.
I’ve learned to charge a restocking fee. Even if items are still new and in good condition, they may need to be tweaked, adjusted, retagged, repackaged and returned to inventory. They need to be counted, the price looked up (if your prices have changed) and a credit memo needs to be made. All of this takes time. Again, you decide what you time is worth, but a 10%-25% restocking fee seems to be the industry norm.
Unless you like writing checks to customers, I suggest you accept returns for exchange only (for more of your work) or as a credit against future orders. This keeps your cash flow healthy, and also keeps them commited to your work. You spent the time with them to get on board with your product; it's nice if they don't take your cash refund and go support some other artist with it.
I’ve also added a requirement for a return authorization. This will help prevent a box full of dozens of items suddenly showing up in your mailbox, especially at a busy time. This will also head off such problems as the dollar amount you will accept at any time, the age of the pieces, and their condition.
Custom orders? No returns. Artwork created to a customer’s specific requirements may be almost impossible to turn around and sell to someone else. Again, this is industry standard.
How long should you honor a credit memo? Again, check with state statutes, but typically a year seems to be standard practice.
When all else fails, try that "No, but if..." strategy I told you about in an earlier entry. If what the customer is asking seems like to much, offer an alternative that's good for YOU, too. And come up with a solution that asks them to commit to your work in the long run--trying a new line, trying a different price point, whatever. The return might be a blip in the track, but it doesn't have to derail the train.
I hope you never have to use your return policy, but if you do, life will be a lot easier if you make one TODAY and post it where your customers cannot fail to read it.
