How to Make Holiday Returns as Painless as Possible

Should you relax your return policy for the holidays? A consumer psychologist and retail expert shares his advice.
During the holiday season, make sure your return policy is transparent and customer friendly. (Photo: kikovic/Shutterstock)

The holiday season can be a major boost for your small businesses’ sales, especially if you avoid these common retail mistakes. But all that gifting and spending can also mean more returns.

According to a 2015 report by the National Retail Federation (NRF), returns rise to 10 percent of all sales around the holiday season, up from 8 percent the rest of the year. Though it seems like a small increase, retailers lose out on $63.05 billion in merchandise in the season.

For small businesses, navigating these returns +can be like navigating a minefield. Consumer psychologist and retail consultant Bruce D. Sanders, author of “Sell Well: What Really Moves Your Shoppers,” shared his tips to protect your business and keep customers happy after the presents are unwrapped.

Stay consistent

In a 2015 survey, the NRF found that only about 25 percent of retailers changed their return policies during the holiday season. Among those who did, the majority enacted tighter policies (requiring receipts, shortening return windows) rather than looser ones (no receipt required, stretching out return deadlines).

For the small business retailer, Sanders advises clients to keep their return policies unchanged — if they have written smart, lenient return policies in the first place. The reason to have as lenient of a return policy as possible (don’t be exchange-only or all sales final, offer credit card refunds instead of just store credit, etc.) is to align with consumer expectations created by online retailers, who usually have extremely liberal ones.

Sanders said small business owners may want to consider accepting returns on goods even after the return period ends — if the item can still be resold. “I like the idea that if you bought this item and it’s not suiting your needs, you can bring it back if I can still resell it,” he said.

Communicate your policies to the customer

During the holidays especially, Sanders recommends retailers be upfront about their return policies to alleviate problems later. “Online shoppers pay a lot of attention to the return policies because they want to know if they’ll have to pay the return shipping,” he said. “But brick and mortar shoppers are less aware of what the return policies are.”

Include simple signage at the registers about the policy, but don’t overdo it, Sanders advised.
Print return policies on receipts, if you can, or on small pieces of paper that you include with the receipts. The salesperson should say, “be sure to take note of our return policy.” Give gift receipts.

Another benefit of printing out your policy for the customer is that later on, your salespeople can point to this document when the customer is making a return and has questions. According to Sanders, customers may find it suspicious when owners and clerks talk about policies verbally (like they’re making it up). Looking at a sign or receipt together helps build trust.

Be flexible

Though you want your return policy to be consistent, Sanders said it is always better to lose money than to lose a customer.

This becomes especially important at the holidays, when you may have new shoppers coming into your store because they received one of your products as a gift. One of the biggest reasons returns increase during the holidays, according to the NRF, is that 38 percent of gift recipients return at least one present — many of them without a receipt of any kind.

“Give a merchandise credit and now that person gets a chance to tour the store,” Sanders said. “That’s what I would aim for.”

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