7 Critical Terms to Include in Your Ecommerce Return Policy

Product returns are a necessary part of online retail, just as they are offline. Handling them can be a little more involved and expensive though. The biggest challenges are avoiding unhappy customers and return fraud.

The most effective way to address both issues is to put everything in writing with an accessible return policy, and proper management of the return process. If customers know what to expect and can return products easily, you can salvage your relationship with them. Clear restrictions and security checks will help protect your business from return fraud.

Don’t underestimate the impact of publishing your return policy. According to a recent Canada Post survey, 50% of Canadian online shoppers say the return policy of merchants impacts their decision to buy from them.

  • 63% of online shoppers will abandon their cart if they’re concerned about return policies.
  • 79% will stop shopping from a retailer if they have a negative return experience.

Before finalizing your ecommerce return policy, consider:

  • The terms of your return policies may be dictated by a third party, such as an online marketplace like Amazon or a drop shipping supplier. Familiarize yourself with the policies of all parties involved in the transaction and work them into your own policy.
  • Check into the laws surrounding returns at the provincial and federal level. For example, the Office of Consumer Affairs covers what ecommerce shoppers can expect from retailers in regards to returns and refunds. They recommend consumers contact their provincial or territorial consumer affairs office for more information.  You can flip the perspective to ensure you don’t violate consumer rights. Other than laws applying to consumer rights, businesses are allowed to set their own refund, return and exchange policies.

7 Critical Terms to Include in Your Ecommerce Return Policy

1. Refunds & Exchanges – Will you provide refunds or exchanges? In what circumstances will the customer not receive a refund? If they do, will it be refunded with cash or a store credit? When can they expect to receive their refund or exchange?

2. Options – Where can the item be returned? Does it have to be mailed or do you have an offline store? Some merchants will even partner with an offline store to handle returns or pickups.

3. Cost of Shipping – Do you cover the cost of returns? Do you provide a shipping label? Check your ecommerce platform to find out how it can help you facilitate and track returns.

Shopify Shipping, for example, offers shipping discounts for both sending merchandise and receiving returns.

“With order management in Shopify, you can manage returns and refunds in one centralized place, including the ability to generate a return shipping label for orders. Return labels are “pay on scan,” which means return labels are only charged once they have been used.”

4. Return Window – How long will you accept returned products?

5. Condition – Will you accept items that have been obviously used? What if the product has been damaged by the customer or shipper?

6. Products that Can or Can’t be Returned – Usually this is based on sanitation, but there could be a number of reasons to not accept returns of some merchandise. Discounted products or items without the original packaging, for example.

7. How to Return Products – Include the exact steps a customer should take to start the return process and any contact info they need.

Internal Return Policies for Ecommerce

You’ll want to establish internal guidelines as well, such as when you’ll tell customers to keep an item rather than absorbing the expense of return shipping. Situational guidelines can be automatically applied with some return management software or apps.

Additionally, you’ll need a plan for returned merchandise processing and disposal. Can it be resold? Will the manufacturer take it back? Can it be refurbished? Can you donate it? Will it have to be recycled? Canadians are concerned about the environmental impact of returned products, so you may want to make this policy public.

Finally, make sure you have a link to your return policy on every page of your website in a place that’s easy to spot. Being open and transparent about returns will reassure the customer and protect your business. By Canadian law, your return policy must be accessible.

Is there anything else you feel should be included in an ecommerce return policy for online businesses? Please share your tips or questions in the comments below, or join us in the Online Business Canada Facebook group.

✔ You may also be interested in reading:
Canadian Guide to the Best eCommerce Platform Software
Rake In Recurring Revenue With Ecommerce Subscriptions


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Digital Business & Marketing Manager at | Website | + posts

Melody McKinnon's formal education is in business management, which she enhanced with more than 60 certifications revolving around business, marketing, health, general sciences and writing. In over 20 years of working online, she has owned or managed both educational and eCommerce websites.

Melody has worked with many businesses & brands in a multitude of capacities. She can often be found on CanadiansInternet.com, CanadianFamily.net and AllNaturalPetCare.com, as well as other quality digital publications. Her content has earned reference links from highly-respected websites, magazines and university textbooks.

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