And 73% said that their experience with returns would affect their decision to buy again from a web retailer. Don’t hide your deadline in the fine print; state it prominently, in bold type in more than one place on your returns page. Almost a third of shoppers buy extra items with the intention of returning some of them, according to research by Barclaycard. Many of your customers prefer to return in store, so give them that option. Whether you are an online seller or a marketplace seller, after reading this guide, you’ll understand the basics of sales tax for eCommerce, and we’ll present you with the solution for all of your sales tax troubles. Also, by including your Refund Policy in your Terms and Conditions agreement and getting agreement from customers to be bound by your terms, you're by default getting agreement to your Refund Policy since it's part of the Terms and Conditions. An eCommerce process flow can often be an area of online retail that is overlooked. The fact that customers may actually like your business more if you recover well from a mistake such as a damaged or mispacked package is called the service recovery paradox. Additional state laws may also apply to your returns policy. Any product you return must be in the same condition you received it and in the original packaging. You’ll also legally need a Privacy Policy.Having a Privacy Policy for your ecommerce store is required since your store will collect several pieces of your customers’ personal information to process an or… If you wish to limit this in any way, you will need to create and post a Return Policy with your own custom terms. A discussion of returns is no longer complete without addressing the delays caused by the 2020 global pandemic. A Terms and Conditions agreement isn’t the only type of agreement you should have for your e-commerce store. Amazon can connect the account users used to make a purchase to their Refund Status dashboard, users can check their refund status by following a few instructions once they are logged into their account. Here are 12 best practices to reduce your e-commerce return rate and increase customer loyalty. You can even use graphics to inject a little humor into an otherwise dry subject. You might find returns frustrating and demoralizing, but you should never let your customers see this. email addresses, first and last names), you're required by law to have this agreement. As reported by Web Retailer, 88% of consumers surveyed rate free return shipping as “important” or “very important” to their purchase decisions. By comparison, sales tax in the U.S. is imposed only on the final consumer. There are three big reasons your business needs a return and refund policy: 1. This is required by law.Use this agreement to inform users about your privacy practices and what kind of personal data you collect from users. In fact, you probably can’t catch coronavirus from a package. Free shipping on e-commerce returns is almost as important as free shipping on the initial order. Ecommerce sales are predicted to reach $630+ billion by the year 2020. If you have lots of repeat customers who know your merchandise, your e-commerce returns are likely to be lower than the average. Generate a free template just by entering your details on the form. Please keep the receipt. Thank your customers for doing their part in completing the returns process. This growth in online sales will be matched by a growth in ecommerce fraud. Booking.com owns the platform, but the policy on refunds depends on the hotel. This is even more important if you want to expand into international e-commerce. Great return policy examples I promised you a return policy sample - but instead here are five examples from stores (big and small) to inspire your writing. However, there are ways you can leverage returns to support the health of your online shop and keep your customers happy. If you provide the service and convenience your customers expect, you will retain their business and grow yours. What are the main benefits of having a Return Policy? The Policy is part of the 3 legal agreements your e-commerce business should have: The "Privacy Policy" agreement. One major factor that dictates where e-commerce customers choose to shop is the existence or lack of a fair and comprehensive return policy. The "General Conditions of Carriage" document is the agreement that each user must agree to in order to buy a ticket through WizzAir's mobile app: Download the Return & Refund Policy Template as a PDF file or Download the Return & Refund Policy Template as a DOCX file. eBay's help pages mention that stores with return policies published online will sell better. Returned holiday gifts can be a big headache for e-commerce retailers. 1 to 12 of 35 Free eCommerce Website Templates Available on the Free CSS site Niture View This Free Template » Greeno View This Free Template » E Store View This Free Template » Level View This Free Template » … ), What form you provide a refund in (original form of payment, store credit only, etc. The U.S. store of Apple has a more detailed return & refund policy: It covers these sections, but its full policy on sales and refunds is more detailed: IKEA says that "It's ok to change your mind" on their U.S. store return policy: The Returns & Refunds page of Amazon is more comprehensive as it groups everything into 3 sections: Returns, Refunds and Exchanges. But free returns can cost your business. Please check the room and rate details thoroughly for any such conditions prior to making your reservation. If you want to understand what that means for your bottom line, you can take the average e-commerce return rate of 30% and multiply that by your expected sales volume in the coming year. Your return rate will depend on the type of item you sell and the type of customers you sell to. Faster returns also mean quicker turnaround for you. WizzAir doesn't have a Return and Refund Policy like most e-commerce stores would, but their General Conditions of Carriage page is informing customers about their rights to refunds. This trend is most pronounced among millennials: more than half of them will shun your site if you hassle them about a return. Returns are part of your overhead. Here's what a policy based on the above tips will look like: If you are not 100% satisfied with your purchase, you can return the product and get a full refund or exchange the product for another one, be it similar or not. (More on this in the next section.) To refund an item, click the drop-down box next to the item you wish to refund and select the number of units. There are two main benefits to having a Return Policy. And if appropriate ecommerce fraud prevention measures aren. A well-designed page about your returns policy is a chance to make a human connection with your customer. More than two-thirds of customers will buy something else when they come in to make a return. A 2019 survey by UPS found that e-commerce shoppers research their purchases and gravitate to shops with transparent policies. Having a return policy that’s clearly worded and easy to find builds trust with your customers and leaves less room for frustration as they figure out when and how to make returns. You offer superb products and top-notch customer service coupled with exceptional order fulfillment. Steal the parts you like from successful online retailers to create your own e-commerce returns guidelines. Only you can crunch the numbers and see at what point the additional sales from a strong refund policy balances the lost revenue from refunds. If you have lots of repeat customers who know your merchandise, your e-commerce returns are likely to be lower than the average. Under US federal law, you must accept back merchandise that is defective. Shoppers are far more likely to do business with companies that have and post a Return Policy. For example, in the state of New York, if a retailer does not provide a Return & Refund Policy, the retailer will be required to accept returns and give refunds for all merchandise returned within 30 days of purchase. If the cost of return shipping is too much for your business, get creative. About Our Return and Refund Policy Generator Whether you operate an ecommerce store, online marketplace business, or SaaS site, our refund policy generator will create a comprehensive, easy-to-understand return policy that details all the necessary clauses, including: However, T&C documents are often met with confusion by both businesses and consumers alike. Copyright 2020 Red Stag Fulfillment. When you calculate the cost of free return shipping and a liberal refund policy, don’t forget to include the opportunity cost of lost business when you make returns difficult. A 2012 survey found that 96% of respondents see free shipping on their orders as an incentive to buy. 2. Returns can be a major headache for retailers. E-commerce sellers or Online shopping sites like Flipkart and Amazon are also under the compliance of GST, that means they are required to file regular returns and pay taxes in GST. Returns can erase your profit on sale items, so consider a returns policy that excludes products you sell at a steep discount. Let customers view their orders and select which items they are returning. Record a Vendor Refund Vendor Refunds are recorded the same way you would do with invoices’ credit notes: You can either create a credit note from scratch by going to Accounting ‣ Vendors ‣ Refund , and by clicking on Create , or by opening the validated Vendor Bill , and clicking on Add Credit Note . Online retailers currently deal with around 206,000 attacks on their stores each month. You could add the Return and Refund Policy in your Terms and Conditions rather than having a separate agreement on returns. However, if you want to go above and beyond to make sure your bases are covered, you can add an unticked checkbox to the final checkout screen of your ecommerce store that users will have to check to show they "Agree to your Return Policy.". By giving your customers the incentive to quickly and easily return a product, you spend less time with reduced inventory. To overcome these issues, create a return list showing all the items being sent back. FiftyThree's Pencil has a 30-days refund policy: customers can buy the product, try it and if they are unsatisfied, they can return it within 30 days. First, you will be able to control your return terms. Calm the Ham. The pandemic and the fear of transmitting infection has forced many eCommerce fulfillment centers to slow down returns. You can return a product for up to 30 days from the date you purchased it. They are less likely to blame you for a return that goes wrong if they know your return deadline in advance. Furthermore, Web Retailer reports that, if your e-commerce business has at least 40% repeat customers, you are likely to have 50% higher sales than online retailers who have 10% repeat purchasers. State laws usually call for only the bare minimum; merchants are advised to reference their local laws, but most states just require a brick-and-mortar merchant to prominently post these policies somewher… To help you choose the best fulfillment This includes retail stores as well. Your business can help reverse this effect by choosing ecommerce shipping solutions and packaging options that are good for the planet and for business. If it’s higher, it might be time to implement strategies to reduce your return rate (unless you sell sized items like apparel; then a higher e-commerce return rate is simply part of your cost of doing business). 3. your business. After a return, re-engage with your customer to keep the relationship alive. In 2016, CNBC reported that retailers often have e-commerce returns as high as 30%, and clothing sites can see e-commerce return rates as high as 40%. It specifies the exact terms in which returns and refunds are processed: While the 30-days refund policy is available on the Pencil's product page, the "Pencil Guarantee" page is placed in the footer, but only available if the user clicks on the link named Legal first: And then clicks on FiftyThree's Shop Guarantee: Calm the Ham's policy on returns and refunds is available if the user clicks on the "Shop Policy" link from the footer: Calm the Ham's Return and Refund Policy is very simple: If you are not 100% satisfied with your purchase, simply send it back within 14 days and we'll refund the full cost of the item minus shipping costs. If you make returns simple, most customers will buy from you again. This pick list will help keep your customers honest and make it easy for fulfillment staff to determine if the return is in order. About five billion pounds of returned goods are sent to landfills annually in the United States according to reverse logistics optimization firm Optoro. Here's a killer return policy template that you can use on your online store to skyrocket sales. That means that suppliers, manufacturers, distributors, retailers and end consumers all pay the VAT on their purchases. Envato. The "Return and Refund Policy" Generator will create a custom policy for your ecommerce store. It’s good for customer retention to create a Return and Refund Policy that is clear and concise. According to TrueShip study, over 60% of customers review a Return/Refund Policy before they make a purchasing decision. That all adds up to unbeatable value for your customer. You should also add a short paragraph to your Terms and Conditions agreement where you summarize your Return Policy and link to the full policy. This template is free to download and use. After initial supply chain headaches, eCommerce has bounced back and is thriving. The fashion and electronics industries are both coming under scrutiny for the environmental impact of returned or excess inventory that ends up in landfills. You could find out through trial and error what return policies work for your business. On the flip side, if you make e-commerce returns simple, you can actually increase customer retention and loyalty. Did you know that you can generate a Privacy Policy and a Terms & Conditions with TermsFeed absolutely for free? When a customer returns one product, you can show them why another might be better, and you might even convince them to make that purchase. As ecommerce sales continue to rise, so, unfortunately, will the waste they produce. 1. Unlike sales tax, VAT (value-added tax) is collected by all sellers of goods and services at each stage of the supply chain. It's the single most important agreement your e-commerce store needs to have as it can affect your retention rate. When you draft or revamp your e-commerce returns policy, the most important thing is to find a policy that works for you and your customers. So do what you do on your other pages and make your policy easy to understand with graphics, icons, and images. Many customers won’t buy from your online store again if they have a bad experience with e-commerce returns. The Envato Market Terms page is linked from the footer of their website: The Booking.com iOS mobile app doesn't have a separate policy on refunds, but their policy on refunds depends on the policy of refunds of each hotel chain that has listed on Booking.com. This is the opposite of the transparency that’s so important for a successful returns policy. If you don't post a Return Policy, some laws require you to provide a minimum timeframe to accept all returns. You may also lose potential customers who are concerned about not being able to return a product if they need or want to. An honest assessment of the cost of your e-commerce returns will help you figure out whether you need to adjust your prices. Simply posting it will be enough to make your policy enforceable. Your pricing should cover your overhead as well as your cost of goods sold. If it’s below 30%, give yourself a pat on the back; you’re doing better than most. rights reserved. Manual: Refunds change the WooCommerce order status, but you need to return the money manually to your customer (jump to section). But eCommerce sales tax rules, not so much. Visit e-commerce sites you like and study their return policies. When you provide an online portal that makes returns easy, you save time for both you and your customer. You need speed to meet customer expectations. All sales are final would imply the opposite, that a customer would not be able to cancel or return a good once a purchase has been made. Harvard Business Review reported the effort led to a savings of $500,000 in labor expenses. You’ll have to tweak things once you put your e-commerce returns policy into practice. Shoe fit is tricky, so Zappos needed a return policy that would reassure customers that they wouldn’t be stuck with shoes they didn’t like. Download the Return & Refund Policy Template as a PDF file, Download the Return & Refund Policy Template as a DOCX file, download this Return & Refund Template as a Google Document, How many days they have to return a product, How will they receive the refund (credit or replacement), If you offer refunds for digital products or in-app purchases, Who pays for shipping to return the product, How many days customers have to initiate a return, Conditions of returns (must be unworn, in original packaging, etc. From there, it should just take a click to print a return label. As the popularity of online shopping grows, so does the opportunity for cybercriminals and unscrupulous consumers to scam online businesses. In addition, graphics give cues to help your customers easily understand how returns work on your site. The only certainties in life, the saying goes, are death and taxes. This is especially important when shopping online, as more issues are likely when purchasing something without being able to see it in person first. In retail, returning is the process of a customer taking previously purchased merchandise back to the retailer, and in turn, receiving a cash refund, exchange for another item (identical or different), or a store credit. Most e-commerce stores should have a Return or Refund Policy. ), If you have any restocking or other fees you deduct from refunds, The numbers of days a customer can notify you for wanting to return an item after they received it. You get money up front for the sale, in return for delivery of a product as described within the timeframe specified. WizzAir lets you search and buy flight reservations through its mobile app. That allows you to get your merchandise into another customer’s hands more quickly. What kind of refund you will give to the customer after the item is returned: another similar product, a store credit, etc. BigCommerce has compiled some great tips and examples to give you a head start. Whatever your return policy may be, it should be clear, easy to read, and easy to find on your website. provider, take a look at our Fulfillment Company Questionnaire. If your e-commerce returns policies are spelled out in a page of dense, fine print, your customers’ eyes will glaze over. A more recent study put this number higher, at 40%. In addition, clothing and shoes are returned at the highest rate year-round, especially because customers often buy multiple sizes with the intention of returning items that don’t fit. While online reviews are an important way to inspire consumer trust in your business, an online purchase is still a risk for the consumer. We are all overwhelmed by how much content we need to absorb in our hyper-connected world. Download Return/Refund Policy template. for e-commerce sellers. Did you know at least 30% of all products ordered online are returned as compared to 8.89% in brick-and-mortar stores. Disclaimer: Legal information is not legal advice, read the disclaimer. Make sure that your retail prices include enough margin to cover your operating expenses. A well-crafted refund or return policy increases the reputation and trust of your online store. You can refund/reverse ecommerce transactions: by making changes to. Clear expectations in your return policy also means you get fewer people calling your call center about returns, which saves you time and money. Estée Lauder turned around its returns program by creating a system for processing unwanted makeup and perfume. Returns are one of the biggest pitfalls for e-commerce businesses because the costs can easily add up and hit your bottom line. By making the return process simpler, you help your customers make their returns more quickly and with less hassle. This investment hits your bottom line. Even though your e-commerce return policy was an important part of the buying decision, most of your customers didn’t expect they would have to return something. All sales are not finalAll sales are not final implies that a customer can cancel and exchange or claim a refund on the purchase. We take a look at some key stats and trends around ecommerce returns. Sales conversion rates. That customer was interested enough in your business to place an order; there’s a good chance you can lure them back. But is your policy on e-commerce returns working against you, rather than for you? You may want to add a link to your Return Policy at the final checkout screen so users have another chance to review your policy before finalizing the purchase. The extra time ensures that the packages are virus-free before workers handle them. The site offers free returns and gives customers a whole year to send back shoes that don’t work out. A Return and Refund Policy is the agreement where you inform customers about your policies regarding returns and refunds. Ask your customer to print the list and put it in the box with the returns. It includes these sections: This article is not a substitute for professional legal advice. If you don't have a Return Policy, you may be at the mercy of state laws regulating return and refund timeframes. Ecommerce churn rate. Refund and return rate. The Refund item total will update accordingly. These consumer desires come with hidden costs: 20% of online retailers have raised prices to make up for the expense of e-commerce returns. Multiple factors impact how a return policy is written. But returns are an important service you provide for your customers. Packages may be quarantined after they arrive at the warehouse. Most e-commerce stores should have a Return or Refund Policy. ), Restrictions on returnable items (no returns on software or undergarments, etc. Pay close attention to common gaps that result in “where’s my refund” or “where’s my exchange” questions from customers. The "Terms and Conditions" agreement.This is optional but recommended. Check out our new infographic for latest E-commerce product return rate statistics and trends. Safeguard against legal backlash — Rules regarding store policies (including online / ecommerce stores) are determined and upheld by two bodies in the US: individual … Ecommerce Legals and Law Ecommerce transactions should be legally straightforward. Hi there! Unfortunately, growing sales mean not only higher revenue but also bigger losses due to fraud. Customers must be informed about their rights to refunds. Think of e-commerce returns as a core part of your customer retention program. However, speed is not always possible. The returns experience could have as big an effect on your repeat business as the initial sales experience. The study found that 36% of online shoppers had made a return in the previous three months. A clear e-commerce returns policy that sets expectations for the time period during which customers can return an item allows your customers to understand what’s required of them in the returns process. In other words, repeat customers are vital to your business. 12 Best Practices for Your E-commerce Returns and Refunds. An ideal policy to deal with reverse logistics delays is the same as your returns policy in general: transparency. Recent events have highlighted the fact that your eCommerce business needs to be prepared to adjust to the unexpected, sometimes very quickly. This could encourage your customers to purchase a few extra items to bump themselves over the limit while ensuring that you aren’t spending more on return shipping than the value of the items. If you have data on your past e-commerce returns, calculate the average e-commerce return rate for your own business. Secondly, you will gain the confidence of potential customers and convert more sales. In addition, an online returns process protects you from return fraud. FiftyThree will offer either a refund or a replacement. But your e-commerce return rate can go up by as much as 50% above normal after the holidays. For example, you could state in your return policy that you’ll pay for return shipping on orders over $50. Customers must be informed about their rights to refunds. It also created a secondary market for the returned products with annual revenue of a quarter of a million dollars. That person could become a loyal and profitable customer. But returns can be costly. The "Return and Refund Policy" Generator will create a custom policy for your ecommerce store.