Tuesday, January 05, 2010

Please share... How do you handle Returns & Refunds for your Handmade Items?

Although I have an established shop policy about returns & refunds, I had never had to refer to it in over 600 sales in my fiber art shop until recently.  Last week a customer contacted me wanting to return a scarf for a refund.  Their reason was that they "just decided on something else" for their friend's gift and no longer wanted the scarf.  There was nothing wrong with the scarf.  In fact, the buyer even stated that they weren't dissatisfied and that the scarf was beautiful.  This obviously made me scratch my head in wonder...

BUT, in accordance with my current return/refund policy, I agreed to refund the purchase price less any shipping fees after the scarf arrived back to me in good condition.  Well, it arrived yesterday in its original condition so I refunded the money via PayPal to the buyer.  I received a "Thanks." and will probably never have contact with the buyer again.

All of this has me wondering though if I should alter my current return/refund policies to make them more strict. There are at least a couple of reasons to do this.  First of all, I am not a chain department store.  My items are handmade in small quantities.  Every sale counts!  Second of all, since my items are handmade and many one-of-a-kind or customized in some way, I can not always resell an item if it is returned.  For instance, the scarf that was just returned will probably end up in a blog giveaway or as a gift to someone at some point, because I don't feel comfortable reselling a one-of-a-kind item that a customer has had possession of and returned.  Essentially, I lost the resale value of the scarf even though it was returned.  That is ultimately money out of my pocket and work time wasted!

I do not want to do away with my return/refund policy entirely though because I want to ensure my customer's satisfaction in some way.  I am considering adding the clause "Returns accepted and refunds given for product defect only" or something to that effect to my current policy.  It is not that I don't want to make my wonderful buyers happy.  It is just that I am a very small business and every penny counts.  If I can not resell a returned item, that is a cost that I have to just swallow.

That brings me to my initial reason for posting this.  I would really love to know what your return/refund policy is if you are an artist or crafter who sells their items online or at shows, shops, etc.  How lenient are you?  Do you have any specific guidelines?  Please do share!  I'd appreciate your input in the form of a comment.  Hopefully we can all learn from each other, and I can decide what to do about my current policy.  Thanks!

6 comments:

  1. Hi

    This is pretty much how I have my Return Policy stated. (I can not resell my items):

    Each of my items is handmade. My items are not something that you can buy in a big-box store, or any department store. I also do not conduct business like a 'store'. I ask that you read all of my Policies before purchasing any of my items.

    I try to be as meticulous as I can be when it comes to my creations and I will package and take care of my creations so that you receive a thing of beauty when you open the box or envelope they come in.

    I add insurance on all of my packages. I use Priority Mail for both Domestic and International shipping. I am protecting myself and my customer by doing this. Should an item arrive damaged or not arrive at all because of the U.S. mail, we will both need to contact the US Postal Service and begin proceedings to kick the insurance into place so that neither of us takes a loss.

    If you have chosen one of my items for yourself, payment will be due from you immediately.

    Sales tax (8.25%) will be collected for anyone purchasing within the State of California or using a State of California address.

    I ship once a week... usually on Thursdays.

    Please note: For hygienic reasons, NO RETURNS ARE ACCEPTED on hats/headpieces or anything worn on the head or hair. (I know where the hat/hairpiece has been while it has been in my possession. I have no way of knowing where it has been after leaving my studio and I could not guaranty its cleanliness to another customer).

    I do not offer refunds on my items unless my description is faulty or I have misrepresented myself. If that has occurred I will refund your money, less shipping, after the return of my item, in the same condition as it left my hands originally. You must return ship the item to me using the same method of shipping and include insurance, delivery confirmation and signature confirmation, if that is what I used when I shipped to you.

    For my international customers... please be aware that you are responsible for all fees, taxes, and duties associated with shipping to your respective country.

    If you have any questions regarding any of this, please do not hesitate to convo me or email me at DreamWoven@gmail.com

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  2. You did the right thing and, after 600 sales, you should just chalk it up to a loss if you feel you do not want to resell it (although, I certainly would). You can always donate it to an auction for a tax receipt or gift it and write it off as a loss/damage. If you want to make your policy more strict, you could also refund a portion rather than the entire amount as a handling fee. I agree no refunds on head wear. I have never had a return, but as an artist, I would rather refund money than have someone have one of my things in their possession that they did not want/appreciate.

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  3. You are lucky to have not had returns up to now. You have to decide if the good customer service will end up with the customer buying more from you in future. I have exchanged a scarf for a woman who bought it at one sale and then contacted me because it was the wrong colour. She came to my next show and exchanged it for another one. She will probably back at the same sales next year.
    You could change it to cash refunds for defects. Exchange with minus a 25% restocking fee for items returned for any other reason. No refunds on custom work. I like to have a non refundable deposit on custom orders, with the balance due prior to shipping or at pick up. Of course you have to say it all nicely as dreavwoven does
    Many small and large stores have gone to the restocking charge because people buy items, use them once and then return them. This is particularly a problem with high end clothes.

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  4. I make bath and body products and candles. I do not accept refunds unless an item is defective in some way. But it's the nature of my products that prevents returns. You could charge a restocking fee of 20%. You have paid for listing fees/ credit card fees/ your time packaging/ etc. all to sell this one product. That may make you feel comfortable cause you're allowing refunds, but most people won't return the item with a fee and if they do, you've covered all the costs. Just a thought. I am of the feeling that handmade items shouldn't be returned unless there's something wrong with them. This isn't Target.

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  5. That's tough one. Sometimes I think people are so used to being able to change their minds and take something back to one of the big stores. They really don't understand all the work that goes into handmade articles. I think I might adjust the policy to say refunds are on a case by case basis.
    I had one item that went to Australia and was crushed in shipping (a clay sculpture, not felted) and I did replace the item because that she was a repeat customer and I think will order again. But I really paid for that item between making a replacement and shipping it again (this time in a heavier, more exspensive box.) And the item itself wasn't that exspensive. Its was a lesson for me, opening my eye to roughness of overseas shipping, and I totally will pack fragile items much more carefully in the future.
    For a hat or scarf, I'm not sure I'd take it back, because of the whole resale thing... but if it was one of my OOAK felted sculptures I would rather have it back and refund it, because I have an emotional attachment to their creation.
    I try to always get insurance and tracking when available.
    I definately going to review everyone's comments and make sure my policies state certain things.

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  6. Thanks so much for the comments and advice! I have decided to just add the little clause above, but in reality, I will just do my best to provide quality items and good customer service whatever the case. I wish that I had more time to comment, but the little munchkin needs me right now. Bye for now, and Thanks so much!!

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