As a consumer – we are always concerned when we order that which requires delivery. We call it the last mile in home furnishings – but it really applies to any item that we (the consumer) have that set “level of expectation”. The pizza is hot and on time. The cable guy – on time (right). Furniture, unscathed. Perfect. Better than we remember it. How do retailers even begin to manage the unmanageable?
Terms and conditions: There are no conditions. All Sales Final. No Returns. Retailers are so scared of returns they make it a barrier to the sale with conditions so absolute that it paints the polar opposite of what they should be trying to convey; that positive experience. In a recent article in RetailDive – the writer discussed the power and problems of returns when dealing with online retail. That is absolutely a challenge. As I told our eCommerce teams, I do not want to become the Zappos of sofas and dining sets. (IMO Zappos has taken the return and flipped it on its head and made it a HUGE competitive advantage – you probably know this). As a online retailer we had to strike that fine balance of “positive experience” (something the customer would find acceptable) and the ability to support it on the P&L! The target was never still. Not a one size fits all solution; different by category, vendor, even products.
Look familiar (the picture)? Looks like a recent delivery from an online vendor for bar stools. Of course, missing the hardware for one of the legs. One call had a new stool. I would have accepted hardware! Either way – inconvenienced yes, but experience “restored”. Absolutely. As a brick and mortar retailer – think about your return policy. You must look at each category of products you sell and determine your pain threshold; what makes sense as you strike your fine balance of desired “customer experience” with your business and your financial tipping point. A well-respected VP of Sales once told me – “Jesse, furniture is designed to go one way, and come out of a box.” Challenge accepted!
So let’s look at your product categories and policies.
(I am prefacing all of these with the assumptive and givens: The items come back as new, with everything, including the box and packaging). Back to the program.
Start with the easy(ier). Casegoods (or anything you would or could normally stock with a great chance at resale).
Returns accepted. No questions asked. Must be in original packaging. Must be in new condition or as received at time of delivery. As a consumer I think this is extremely attractive. As a retailer, I might be tempted to toss in a “like for like” exchange clause. That also might be OK, really depends on your mix and depth in that category. Don’t just do it to try and keep the sale revenue! Can you add something to prevent taking it home to try it? Sure. Maybe full refund within 24 hours – 10% restocking fee after 24-hour period. The table may look one way in the store. At home, completely different. We have all experienced it. If it comes back with wine glass marks – that is definitely not new condition. Find that acceptable balance. Is this a competitive advantage to your business? Maybe. Shop the competition. If you win – talk about it on the showroom floor during the sales process early on! Use it to your advantage. While your returns may increase – i expect they will actually be an acceptable % of sales as your sales could also go up as a result of a favorable “policy”.
Special order items. Anything that you order to the customer’s specific requirements. Super tricky, but doable. However, don’t immediately jump to “No returns on Custom Orders”. Consider a softer approach – again something the consumer will hear from you during the process and say – “that’s fair”. Consumers (for the most part) expect a fair deal at a fair price on a good product. You improve on each, man you are really working the magic! So, for special orders consider the following idea. Maybe it is tiered based on chance of resale: 3 tiers, Class A, B, and C. No refunds on Custom Class “A”. This would be super extremes and highly unlikely to resell. Hot pink sofa. You get the idea. Even at cost – it won’t move. Certain items are that absolute. I’ll sign up for that. If the product is defect free and it is nothing more than an ugly choice = it is what it is (IMO). Get ready for a Yelp review. Sorry. Then maybe Custom Class “B”. These are items that would probably re-sell. Not saying you want them back, but they are not outside the realm of possibility of resale at a healthy discount. Maybe it is a 15% restocking on Custom Class B items. Obviously new condition and all those items apply. Take that 15% and knock another 10% and move that item quickly! Then maybe Custom Class “C”. Yep. The taupe sofa with motion. Maybe you don’t carry motion, but this special order is main stream and appeals to a wide audience. If its new condition, maybe this is the item that there is no fee on if its a like item equal or greater value play. Something painless – not pain free. But something the customer would agree with and find acceptable.
I shared some ideas above. Use them or use them as a starting point. They are just ideas so please carefully weigh the pros and cons. Look at each of your ideas from both vantage points; the conservative risk adverse retail business owner and then the Zappos-Amazon trained consumer. Once you come up with your policy that is that experience you wish to portray and acceptable to the “business” – make it visible and part of the sales conversation. The setting of expectations is much easier during the sale in comparison to fine font on a sales invoice at the counter. Especially when that fine font is 4 words the consumer will surely hate – they stopped reading at “No”.
Find the entire article here: No free returns? More than half of shoppers won’t buy