Don’t want that gift? Return it (but play by the rules)
Grace Curly at A Different Drummers Kitchen in Northampton.
Purchase photo reprints »
Holiday return policy at Different Drummers Kitchen in Northampton.
Purchase photo reprints »
Shopping bag full of gifts Purchase photo reprints »
NORTHAMPTON — If you unwrap an ugly tie, a boring book or an unneeded gadget this Christmas, odds are good you’ll do what thousands of people do every holiday season — return it.
Returning gifts is a holiday tradition, and it’s also big business. Shoppers returned some $217 billion worth of items in 2011, or 9 percent of all retail sales. That’s a 10 percent increase over the previous year, according to a report from The Retail Equation, a California company that many retailers hire to track returns.
Return policies vary widely, and keeping track of them from store to store can be a challenge. Experts say people need to do some homework before they go shopping.
“It’s important for consumers to educate themselves on what the policies are,” said Jon Hurst, president of the Retailers Association of Massachusetts. “There are some big stores that take anything back at any time, but many smaller retailers don’t have the wherewithal to do that.”
Some stores require receipts; others are more lenient (or can look a transaction up in their computer systems). There are return windows that range from seven days to forever. Some stores will give cash back, while others offer only store credit.
Some retailers even have several policies, depending on the type of merchandise involved.
Sears splits its merchandise into 30-, 60- and 90-day return windows depending on the item. Consumer electronics and air conditioners must be returned within a month, for example, while shoppers have up to three months to return luggage and housewares.
“You really have them across the board,” Hurst said of return policies. “It very much depends on the individual business and how comfortable they are and what their experience has been.”
Extending holiday returns
An informal survey of a dozen downtown Northampton retailers confirms Hurst’s point. Some stores, like Silverscape Designs, have strict return policies while others, like Faces, are much more lenient.
Most of the businesses surveyed were somewhere in the middle, and many of those extend their return policies for several weeks around the holidays.
“We don’t want anybody to leave feeling like they didn’t get what they came in for,” said Grace Curley, a sales associate at Different Drummer’s Kitchen, a cookware store.
Different Drummer’s return policy states that customers can get a full refund if they return an item within two weeks; they can get store credit or complete an exchange up to 30 days after purchase.
But the store extends its return policy at the holidays. Items purchased in November and December can be returned to the store for a full refund by Jan. 8, or by the end of January for store credit or exchanges.
Curley said Different Drummer’s Kitchen sales staff asks for a receipt but is willing to work with people who don’t have one by looking them up through the store’s rewards program or running a sales report.
“We try to make it as painless as possible,” Curley said.
That’s a sentiment echoed by Andrea Goguen, general manager of The Mercantile, which has stores in Northampton and Amherst.
“I’ve been here 16 years and it’s very rare when I refuse a return,” Goguen said. “On the whole the policy works. We’re a very personal store.”
For most of the year, The Mercantile’s long-standing policy states that customers have two weeks to return items, as long as they are in saleable condition, Goguen said. Customers who have a receipt and paid cash can get cash back. She said credit card purchases are reimbursed to the card used.
Customers without a receipt can get a credit that’s good at both the Northampton and Amherst stores.
The Mercantile extends its holiday return policy through January.
“We are very willing to take returns during the month of January; it seems unfair to do anything else,” said Goguen, noting the number of college students who shop there.
The business of returns
Retailers walk a fine line when it comes to setting return policies. On one hand, they want to offer good service — and never want to see a customer walk away angry. A future purchase may depend on it.
On the other hand, returns are costly, and hard-line policies help control costs. Some larger retailers have even begun using services like The Retail Equation to track shopper returns in order to restrict “returnaholics,” or serial returners.
Hurst said stores that adopt strict return policies do so at some risk.
“There is so much power in the hands of consumers, who have so many more choices today,” he said. “Because of that, there’s a lot of pressure on stores to be very liberal on returns.”
Some national chains, such as Nordstrom and JCPenney, will take anything back, anytime.
“Clearly, they lose money on those goods, but in return they determine that the goodwill they get from their customers is enough to convince them to return and spend money to offset the losses,” Hurst said. “That’s something that’s very individual to the stores.”
Jack Finn, who owns A2Z Science & Learning Store in Northampton, said returns should involve an amicable back-and-forth with customers.
“You always have to have room for people changing their minds,” Finn said.
A2Z offers cash back for items returned within seven days of purchase with a receipt and store credit for items returned within 30 days, with or without a receipt. The store extends its return policy during the holidays and typically sees a surge of returns the first week of January.
Like many store owners, Finn said the returned item must be in “saleable condition.”
“Customers who think they might want to return an item shouldn’t open it up and play with it,” he said. “Saleable condition implies that we can put it back on the shelf.”
He said most shoppers don’t take advantage of the policy. There have been times, he added, when regular customers have blown the whistle on fellow shoppers who are trying to sidestep the return rules.
Finn said he thinks A2Z customers understand how returns can impact a small business, and are satisfied with store credit.
Massachusetts law requires that merchants clearly disclose the store’s refund, return or cancellation policies before a purchase is made. Clear disclosure means that the store must display its return policy, usually by means of a sign at or near a cash register that the buyer can see before a transaction takes place.
A return policy printed on a receipt, but not posted in the store, does not qualify.
Under state law a store can set any type of return policy it wants — “all sales final,” “merchandise credit only,” “full cash refunds within 30 days” and more.
Customers can return goods within a reasonable period of time if no return policy was disclosed, though the state does not define reasonable period. Restrictions in return policies do not apply to defective goods. The store is required to give you a choice of a refund, repair or replacement if merchandise is defective. State law does not set a time limit on defective items, which are evaluated on a case-by-case basis.
Retailers reportedly lost an estimated $8.9 billion to return fraud last year, including $2.9 billion associated with the holiday season, according to a National Retail Federation survey of 60 retail companies.
These retailers are reporting an increase in a scam in which people buy products like big-screen televisions or party dresses to use for an event and then return them.
In response, some retailers have shortened the time frame for making returns. They’ve also tightened the requirements for receipts and identification. Many retailers charge a restocking fee — often around 15 percent of the item’s total cost — for returns of electronics.
Some customers making questionable returns are considered “opportunistic,” taking advantage of lenient return policies when it suits them. But others have criminal intent — returning stolen goods, for instance.
While it’s more difficult to return stolen goods than it used to be because most retailers require a receipt to get cash, a person returning an item without a receipt can often get store credit. He can then resell that credit online at a discount.
Other scammers perform so-called price manipulation. One example: The person purchases two similar items with different prices and switches the packaging. He returns the cheaper item — and gets the refund for the higher-priced item. Then he sells the more expensive item online.
Such return fraud presents challenges for retailers, said Rich Mellor, NRF vice president of loss prevention, in a press release.
“Even more troubling is the fact that innocent consumers often suffer because companies have to look for ways to prevent and detect all types of crime and fraud in their stores,” Mellor said.
High-end retailers are particularly susceptible to return fraud, and have policies designed to prevent it.
“We don’t want someone to buy a $10,000 diamond ring, wear it for a special night and then bring it back,” said Lorrie Motyka, general manager of Silverscape Design, a Northampton jewelry store. “With the high-ticket items, we have to be really careful.”
Silverscape does not give cash or credit card refunds for returned merchandise. Instead, customers can exchange an item for store credit within 60 days of purchase as long as it is not worn or damaged. While Motyka recommends that customers who want to return an item bring the receipt, the store keeps a history of what’s purchased and can often look up an item.
She said Silverscape’s return policy applies to all its merchandise, from a $20 bracelet to a $10,000 ring.
Customers are generally satisfied with the store-credit policy, Motyka said.
“In our store, you most certainly can find something else,” she said.