How To Write a Return Policy (+ Free Template) (2023)

Returns and refunds are an element of doing business online.

Customers is perhaps unsatisfied with their order for quite a few reasons—it arrived damaged, they ordered the unsuitable size, or it simply didn’t meet their expectations. Alternatively, many buyers will purchase multiple versions of the identical item—say, the identical pair of jeans in various sizes—to check out at home. This practice is referred to as bracketing.

With no proper system for handling returns, including a transparent return policy, these requests can eat up a variety of time, energy, and money, with hours spent on customer support emails and spikes in shipping expenses for substitute products, especially after the vacations.

The excellent news is that it’s never too late to deal with the issue. With an incredible return policy and the best system in place, returns can turn from a dreaded task into a chance that generates recent profits and increases customer loyalty. 

Before we dive into easy methods to write a return policy in your store and implement a system to handle requests, let’s discuss why it’s so necessary to get returns right.

What’s a return policy?

A return policy is a algorithm a retailer creates to administer how customers return and exchange unwanted merchandise they’ve purchased. These policies tell customers what items could be returned and for what reasons, in addition to the timeframe over which returns are accepted.

From Apple’s strict 14-day return policy, to IKEA‘s generous 365-day turnaround, nearly every major retailer offers return and refund policies to their customers—and your online business should, too.

Why have a return policy?

A good return and exchange policy builds trust between a business and its customers. Actually, offering a transparent and consistent way for patrons to return a purchased item can increase conversion and repeat rates.

Giving customers a full refund on their orders can lead to a lack of profitability, and knowing that somebody disliked your product could be disheartening for business owners who strongly consider in the advantages of their services. 

For these reasons, it will possibly be tempting to avoid making a comprehensive return and refund policy and leave the mounting problem unaddressed. As you’ll see, nonetheless, this may be a mistake.

The pitfalls of a poor return policy

Over time, customer complaints about your return policy can begin to filter onto social media, showing up as reviews or comments under your ads and even in Google searches about your online business. That is where a poorly implemented return policy starts to negatively affect your overall status as a business.

If negative sentiment about your return and refund policies starts to spread online, you’re prone to see a drop in each conversions of potential customers and overall customer satisfaction.

Processing every return manually and coping with customers on a case-by-case basis will also be expensive for your online business operations and exhausting for customer support staff. If the time and expense to process a return isn’t monitored and optimized, it will possibly even prevent you from scaling your online business.

The benefits of a customer-centric return policy

Many modern businesses have recognized that a customer-centric return policy is a robust marketing tool. That’s why many brands now advertise “free,” “easy,” and “no-hassle” return policies to extend conversion rates and online purchases.

A return policy that advantages the shopper is usually the differentiator between businesses with a powerful repeat purchase rate and people who depend on one-time purchases only. As the associated fee to amass customers rises, many businesses are easy methods to retain customers and increase their lifetime value.

Although a return may not make a business profitable on first purchase, a greater customer experience is more prone to result in a better retention rate and long-term revenue growth.

Lastly, your status will profit most from offering easy returns to customers. In line with a 2023 consumer survey within the US, over half of the respondents indicated that they had a minimum of “a bit” trust in user reviews. These positive customer reviews and word-of-mouth recommendations in regards to the buying experience pays off as earned media marketing for your online business, helping you thrive.

Organising a return management system

Whether you’re running an ecommerce business or a brick-and-mortar small business, you’ll wish to put a return management system in place to administer returns in your store. Processing returns efficiently can take the pain out of returns for each the business and its customers. 

Whether you’re receiving your first return request or attempting to repair a flawed process, your return management system can immediately help cut down the shopper service hours spent on returns.

What’s a return management system?

A return management system helps you process returns in your customers. It lets customers initiate a return, receive a pre-paid label, and ship the return without taking on an excessive amount of time.

A return management system also helps you manage and track your returns by relisting approved items back into your inventory and monitoring the financial impact of returns in your bottom line.

How do you arrange a return management system?

Fortunately, merchants can communicate their return policy and process directly on their online store and use Shopify to administer the return behind the scenes.  

With Shopify, you may:

• Create a self-service return process. Clearly communicate in your online store one of the simplest ways for a buyer to contact you a few return, whether that’s via email, on the phone, or through a messenger solution.
• Send automated notifications. Send customers automatic updates and notifications throughout the return process
• Send shipping labels. Use Shopify Shipping to robotically email a return shipping label to your customer, as soon because the return request is created. Merchants who use Shopify Shipping also profit from discounts with carriers for each outbound and return shipping. Return labels are “pay on scan,” which suggests they’re only charged once they’ve been used.
• Restock inventory. Merchants can track the return from their customer, restock the returned inventory, and make it available on the market again on the web store.
• Refund the shopper. Once the item is returned, merchants can refund the shopper to their original payment method with the press of a button.

Return labels are robotically emailed to customer as soon because the merchant clicks “create return”

Merchants can manage a return from the unique order, keeping all order history in a single place. Once the returned item is received, the client can easily be refunded using the unique payment method.

Start with return management

 

 

Watch this video to learn easy methods to create a customer-friendly return policy, share it in your online store, and create a return process that makes it easy to administer returns behind the scenes.

Tips on how to write a return policy (+ free return policy template)

On condition that about 20% of online purchases might be returned, writing an incredible return policy is imperative.

Step one to establishing a system to handle returns is formalizing your policy so you may communicate it clearly to your customers. A written return policy lets you treat all requests the identical and avoid the tendency to handle things on a case-by-case basis, which is usually less productive and costlier.

Return policies will vary depending on the logistics of your ecommerce business and the products you sell, but every policy should cover the next basics:

• What items could be returned
• What items could be exchanged
• What products are “final sale” (i.e., non-returnable, non-exchangeable)
• When things could be returned or exchanged (i.e., 30 days from purchase date, with purchase receipt)
• In what condition items could be returned (i.e., frivolously worn, with tags still on, original packaging, original condition, etc.)
• What products could be returned for (i.e., store credit, refund, a product of equal value, etc.)
• Tips on how to initiate a return or exchange (i.e., an email address to contact or an internet page to go to) 

Note: In case your store is using other sales channels, be mindful that these marketplaces have their very own returns policies. What you state in your retail return policy may not apply if using these channels.

Ecommerce return policy template

Below is a basic return policy template that could be adapted to suit your online business. Just replace the bolded text along with your own policy and use the lists as a guide to make sure you don’t forget to incorporate any necessary information:

For those who’re trying to return or exchange your order for whatever reason, we’re here to assist! We provide free returns inside 30 days of purchase. You’ll be able to return your product for store credit, a unique product, or a refund to the unique payment method.

Please note the next exceptions to our return and refund policy:

Below are some examples of common exceptions: 

• Discounted items are final and can’t be returned or exchanged.
• Returned items will need to have tags still on and be returned in original product packaging.
• Returned items will need to have no visible signs of wear and tear or use.

To initiate a return, please complete the next steps:

Your steps needs to be laid out clearly, linking to relevant pages, comparable to your online portal.

1. Reply to your order confirmation email to request which products you want to to return.
2. Print the prepaid return shipping label that you’ll receive by email.
3. Send all items back to us using the label provided.

Additional Information:

The next are add-ons with more information that chances are you’ll want to incorporate:

• How long it takes to receive your refund, substitute product, or store credit.
• Any shipping fees the shopper might want to pay.
• Any return restocking fees the shopper might want to pay.
• The way you handle lost or damaged returns.
• Contact information for your online business if the shopper has more questions.

Where to place a typical return policy

It’s not enough to have a well-written return policy: you could also be certain customers see it before they buy. When talking to a frustrated customer who’s attempting to return an item marked as final sale, simply telling them they need to have read the return policy is unlikely to resolve the difficulty.

Include links to your return policy in several hard-to-miss places throughout your website to save lots of time going backwards and forwards with customers who didn’t see the policy. A couple of key places to list your return policy include:

One great return policy example comes from Chubbies, an internet clothing retailer. The brand includes return questions in its website chat window. You may also start a return with one click. 

If the return policy is clearly outlined in your website so it will possibly’t be missed by customers, you’ll set the best expectations prior to buy. While some customers could also be unsatisfied along with your store’s return policy, hiding that policy in advantageous print only results in a scarcity of trust.

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Strategies for more profitable returns

One unavoidable consequence of a solid return policy and system is that it’s not low cost. Although you may cut down on customer support hours with an app, shipping fees related to returning a product and restocking fees from getting it back into circulation can still threaten your profitability.

Nevertheless, there are a couple of ways to reduce your losses while still offering an incredible return policy to customers.

1. Turn returns into exchanges

The difference between returns and exchanges is most outstanding when profitability. When a customer returns a product for a refund, your online business often loses money on customer acquisition and return shipping costs. Plus, you’ll have to refund the shopper any profit made on the unique order.

With an exchange, the loss is usually less impactful. With strong product margins, offering a substitute product as a substitute of a full refund can keep your online business money flow positive.

A standard strategy to encourage exchanges over returns is by only offering free return shipping if the shopper chooses to exchange the product.

2. Offer store credit

One other strategy to keep losses from a full refund to a minimum: offer store credit.

When presented with the three options above, the alternative to get a store credit could also be more appealing to those that haven’t fully sworn off your brand. While the advantages aren’t as immediate as an exchange, store credit can incentivize customers to spend the identical amount (or more) in a later transaction.

Convincing customers to provide your brand a second probability with a brand new order on store credit also can help improve lifetime value, as they usually tend to come back and buy again in the event that they are satisfied the second time around.

3. Sell product warranties

When a customer chooses to return a product for a refund, one risk an organization takes on is whether or not or not it’ll give you the option to resell the item. 

It may well take as much as two weeks for a product to re-enter stock after a return is initiated, and the time spent in transit and unpacking may leave it damaged. If the product (or its original packaging) is dear, replacing it may not be a reasonable option.

For costlier items, corporations will probably want to consider selling product warranties to customers. Third-party warranties protect businesses against paying to exchange damaged products and avoiding disputes over who’s guilty.

Warranties could be sold through an app like Clyde, which could be added to your website to place the choice to guard an order back in the shopper’s hands:

Warranties like this also can have the potential to unlock a brand new revenue stream for your online business, for the reason that providers often offer a commission on all premiums sold. That way, your customers are protected for a long term, and your online business collects a bit extra revenue as a substitute of paying for damaged goods.

4. Upsell or cross-sell on exchange requests

One ecommerce returns best practice is to upsell or cross-sell on exchange requests. Although exchanges are often more profitable than returns, their profitability could be narrow depending on the product and its margins. If exchanges are still costly, it is perhaps idea to take a look at upselling or cross-selling on exchanges.

When a customer comes back to your website to make use of their store credit, there may be a chance to indicate them recent products they didn’t purchase the primary time around that complement what they’re exchanging for.

If you’ve a Shopify store, you’ve access to various apps for showing customers related products at checkout.

Make sure that to regulate your shipping policy for returns. In cases where customers cover shipping costs, consider allowing them so as to add more products to their cart to achieve a free shipping threshold. Upselling can be easier when you understand the explanation for the exchange, and may make a personalised suggestion for a better priced item that addresses needs that weren’t satisfied on their first purchase.

For instance, if a customer is returning a digital camera since it was too heavy, you may recommend a lighter-weight version that may need a better purchase price but resolves the difficulty that they had with their first order.

every return as a brand new opportunity to extend order value by upselling or cross-selling, the motivation to convert more returns into exchanges becomes clear.

Profit from your return and refund policy

Irrespective of how much effort you set into your product and customer experience as you grow your online business, likelihood is you’ll still encounter a couple of upset customers along the way in which.

How small businesses resolve to take care of these unsatisfied customers is a very important think about the endurance of your brand. An organization that figures out a comparatively painless shipping strategy to handle return requests is more prone to retain its customers and have them come back and buy again or, higher yet, tell their friends.

Writing a transparent return policy that feeds right into a well-thought-out return and exchange system—and commonly optimizing it—is a robust strategy to cut costs and switch a nasty customer experience into long-term profit and customer loyalty.

Illustration by Pete Ryan