7 days return policy - deducting postage costs?

[faz100]

Hi,
I have been busy setting up our family business, which we hope to launch in the coming weeks. I am helping to setup the ecommerce side of the business and have found this forum a great help in finding the answers to most of my queries.

But, regarding the 7 day return policy, we aim to include postage costs in the selling price, but when the customer wants refund can I legally deduct my postage costs, if I cant then I will be out of pocket.

Hope my question is clear.

Any guidance would be much appreciated.

 

[Chris Ashdown]

The Distant selling Regs state you must give back all you charged including postage

Hard on us small companies and only answer is to give the fullest descriptions and images possible to avoide returns

 

[Steve2507]

Hi,
I have been busy setting up our family business, which we hope to launch in the coming weeks. I am helping to setup the ecommerce side of the business and have found this forum a great help in finding the answers to most of my queries.

But, regarding the 7 day return policy, we aim to include postage costs in the selling price, but when the customer wants refund can I legally deduct my postage costs, if I cant then I will be out of pocket.

Hope my question is clear.

Any guidance would be much appreciated.

Simple answer is don't include postage costs in the price.

There are a few products that aren't covered by the DSR, if you are selling alarm kits then I know there are something which you may sell which aren't covered.

For instance: anything made to order, software etc.

 

[Chris Ashdown]

Unless it is one of the allowed products (very few) then it makes no difference if P&P are included in the price or added on after, you must return the whole amount charged

 

[faz100]

Thanks for the replies

Am i right in thinking from the above two post that if I include postage in the selling price then I have to refund everything.

But if I charge postage separately from the selling price I do not need to refund postage?

 

[lesliedocherty]

We do not refund the postage if the customer changes their mind, i think i am in the wrong, but i dont care, as it seems stupid to do so, not had anyone pull me up yet, every customer has accepted it without question.

We have it in our T&C's

 

[i234i]

We do not refund the postage if the customer changes their mind, i think i am in the wrong, but i dont care, as it seems stupid to do so, not had anyone pull me up yet, every customer has accepted it without question.

We have it in our T&C's

i agree with Leslie, i mean its there choice really.

Id say unless its the fault of the company (wrong item/damaged) then the customer should pay to return. either that or you'll end up getting people just buying 3 tops to see whats best and returning 2 like a littlewoods direct

 

[borobabe]

My understanding is that you have to refund the whole cost unless you are selling one of the excepted items such as personalised items, or newspapers, magazines etc or for me, balloons as they are classed as perishable (when inflated). I also appreciate that there are many customers who are totally unaware of this and therefore some businesses are able to only refund the cost of the item. Best to be aware though, and I personally think if you are including the cost of delivery in with the listed price as apposed to separate, then the customer could think they are getting free delivery and then you will have a problem deducting the postage cost if they should need a refund.

Something to consider.

 

[tempus fugit]

Computer Active magazine is currently promoting a campaign for users to be sure of their rights when buying online - see here.

There's a whole load of useful links on that page, and also a button to their free guide to consumer rights.

Although the articles are all written from the point of view of explaining their rights to the consumers, I think that the clear explanations used by CA magazine might help the likes of us who are trying to do the right thing, and will probably save you resorting to reading and interpreting the actual Regulations.

You might also be able to sign-up and grab their Consumer Confidence Charter badge (although it doesn't seem too clear how you do this?).

Hope that helps .....

 

[duongo]

Hi
We had someone in our local Tradinf Standards to look through our T & Cs when we started:
- you only have to refund the postage (and gift wrapping if you offer this) if the item being returned is faulty.

-If the customer has a change of heart than you do not have to refund postage or gift wrapping.

-But you can not ask the customer to return the item within 7 days, Customers are allowed 7 days beginning the day after the day of receiving the goods to cancel the order and return the goods.

-with personalised goods, yes you do not have to accept returns due to change of heart and you do not have to refund postge.

Hope that helps. Your local trading standards will give free advice if you are unsure of anything,

 

[faz100]

I think I will stick with what you have said Duongo, if they have changed their mind then no postage refund.

 

[duongo]

Hi Faz100
I'm not sure how you are advertising the costs, but if it's price of the product includes delivery, you will need to clearly have what the postage price is on the website if you are not wanting to refund the postage for change of heart. But if you are adding postage into the overall cost of the product and saying 'free delivery' than i don't think you can deduct the delivery cost if item is returned because of change of heart. You would have to refund the total cost.

 

[deniser]

If a customer pays the postage and returns the item because it doesn't fit, they don't like it, they have changed their mind etc then we ask them to be responsible for the cost of returning it to us and we refund the cost of the goods but not the cost of packing and sending it to them because as I see it these are out of pocket expenses that we have incurred at their behest.

If they benefitted from free postage because they spent more than a certain amount then we absorb the initial postage cost and write it off.

But if the item is faulty or misdecribed then we absorb the postage cost on the way out and also compensate the customer for the amount they have paid to return the item to us.

I believe the minimum time period they have for cancelling an order (which they have to do in writing but email will suffice) is 7 working days from receipt of the goods. They then have a reasonable time in which to return them or they can ask you to arrange collection but at their expense.

Our customers take no notice of the time limits and often return things without notifying us first up to 3 months after delivery. We always refund them except when more than 3 months have elapsed but then we offer them a gift voucher. Because some of the big chains are so generous in their returns policy, many people take this for granted and think it's their legal entitlement to get a refund months later which it isn't of course. Then at the other end of the equation, some people believe (because of Ebay) that all internet sales are final and that they can't return anything.

 

[AndYc42]

Surly, if you have stated in your terms and conditions that postage will not be refunded if goods are returned for any reason other than faulty, you would be within your rights not to refund the postage?

I would get customers to tick a box to accept your T&Cs before they can complete the order. In doing this haven't they entered into a contract with you which they have accepted?

 

[Steve2507]

Surly, if you have stated in your terms and conditions that postage will not be refunded if goods are returned for any reason other than faulty, you would be within your rights not to refund the postage?

I would get customers to tick a box to accept your T&Cs before they can complete the order. In doing this haven't they entered into a contract with you which they have accepted?

Sorry it doesn't matter whether you feel you are in your rights or not. You have to refund the full amount.

 

[lesliedocherty]

I do not give a monkeys, i dont refund postage for change of mind, its crazy to.

we sell 6 cans of spraypaint, charge the customer £6 for shipping, it costs us £7, so we lose a pound, we only make £1 a can profit, so thats it down to £5, then 2 pay return postage for 6 cans about £8.50, no way jose.

 

[deniser]

Sorry it doesn't matter whether you feel you are in your rights or not. You have to refund the full amount.

Steve, where does it say this? I thought I had read up on Distance Selling very carefully and I didn't see anywhere that you have to refund postage costs because the customer changes their mind. Being a law abiding sort of person I would like to make sure I am doing the right thing.

 

[Pelenna]

Have a look at the DSR guide here, page 25. Most people wouldn't normally quibble over this though IMHO.

 

[itaufait]

Have a look at the DSR guide here, page 25. Most people wouldn't normally quibble over this though IMHO.

I was just about to write that, but you beat me to it!

 

[deniser]

Thanks Pelenna
I've had a quick read and it is quite clear that:
1. you can't deduct the outgoing postage costs when a customer cancels the order
2. you can ask the customer to meet the cost of sending items back to you provided this is set out in the required written information
3. you can't make any extra charge such as admin or restocking charge
4. you can withhold the cost of gift wrapping and express delivery charges but only on certain conditions and if they formed a separate contract.
5. if the goods are faulty you have to pay for the outgoing and return postage costs
6. you can't require that goods are sent back in or with their original packaging

Some interesting issues arise:
1. The DSRs apply to the rest of the EU as well and for other countries it depends on the law of those countries. So you have potentially got to refund overseas postage costs as well.
2. The DSRs do not apply where a customer has examined the goods in a shop and then ordered them over the internet.
3. A customer cancelling must do so in writing. If they say they are returning something by phone or don't notify you, just send back the goods, presumbly this does not count as a cancellation and you do not have to refund the postage costs?
4. Cancellation rights do not apply to goods made to the customer's specification - this does not include items which are upgraded or made from a selection of components. And doesn't include items specially ordered in for a customer.
5. If the customer cancels you must refund the money within 30 days even if you have not received the goods back!
6. Neither can you withold the refund of the customer has failed to take reasonable care of the goods. Instead you have to sue them for breach of statutory duty to take care.
7. There is no obligation for the customer to return the goods in the DSRs although you can make this a condition of your contract. You can have them collected at their cost or take action necessary to recover them if your contract states this. You can't stipulate any time limit for returning the goods.
8. What is the definition of "cancellation? " It doesn't say so. If a customer writes saying "I am cancelling the contract dated ''' that's clear but what if they write and say "the top is unsuitable so I am returning it for a refund". Is that a cancellation of the contract?
9. Presumbly returning one item out of two means the contract hasn't been cancelled in any event so you can keep the outgoing postage?
10. And if you aren't notified in writing of cancellation within 7 working days from the later of provision of the written information and receipt of the goods then none of this applies anyway and you can keep the outgoing postage costs.

I have to say that I am quite shocked at all this. If one complied with the regulations it would be a field day for fraudsters who could order expensive stuff online, cancel the contract and not return the goods. No need to use a stolen credit card! Let the small shopkeeper sue you for return of that plasma tv which you have been watching for months and is no longer saleable.

The only consolation I have is that people rarely respond on returns within 7 working days and only half the time is it in writing so in most cases I will continue to keep the outgoing postage costs.

 

[.Spiralling.]

I think some of the comments made previously have been confusing the different postage costs.

If an item is returned/contract cancelled under DSR, you are legally obliged to refund the full purchase price including the charge they paid for shipping. If your "required information" (for most of us this will be T&Cs) state that the customer is responsible for the cost of returning the goods, then they have to pay for sending the goods back. If you haven't got this in your T&Cs then you are responsible for the cost of recovering the goods.

But in all cases of returns under the DSR*, no matter what your T&Cs state, you are legally obliged to refund the shipping fee they paid to you.

* personalised, customised, bespoke items, sealed media which has been opened and some other items are not covered by the DSR.

 

[wormcity]

spiralling is totally correct...

fortunatly we don't get many returns, but it is still £7 loss when we do.


the office of fair trading publication (downloadable here )

What specifically do I have to refund to the consumer if they cancel?​

3.48​

The DSRs require you to refund any money paid by or on behalf of
the consumer in relation to the contract to the person who made the
payment. This means the full price of the goods, or deposit or prepayment
made, including the cost of delivery. The essence of
distance selling is that consumers buy from home and receive goods
at home. In these circumstances, almost every case of home
shopping will involve delivery of the goods ordered and so delivery
forms an essential part of the contract.
​

Return of goods following cancellation (Regulation 17)
Who pays for returning the goods if the consumer cancels an order?​

3.55​

If you want the consumer to return the goods and to pay for that
return, you must make it clear in the contract and as part of the
required written information – see paragraph 3.10. If the consumer
then fails to return the goods, or sends them at your expense, you
can charge them the direct cost to you of the return, even if you
have already refunded the consumer’s money. You are not allowed
to make any further charges, such as a restocking charge or an
administration charge.​

3.56​

If you did not include these details in the required written information
then you cannot charge anything. See paragraph 3.10. You can never
require consumers to pay the cost of returning substitute goods –
see paragraph 3.1 for more information.​

3.57​

If the goods are faulty or do not comply with the contract, you will
have to pay for their return whatever the circumstances.​

​

 

[davidjgoss87]

We do not refund the postage if the customer changes their mind, i think i am in the wrong, but i dont care, as it seems stupid to do so, not had anyone pull me up yet, every customer has accepted it without question.

We have it in our T&C's

i agree, this is the way it is with my site and again no complaints. in my view, if you charge for delivery and the goods get delivered, then that part of the contract is fulfilled, and should be seperate to the return of any of the goods.

also, what happens if somebody buys 3 items of different prices and is charged £6 for delivery, then returns one of them for a refund but keeps the other two? would you have to split the charge based on no of items, or percentage of order value?.

this law doesn't seem to have been thought through, probably a result of pressure from consumer-champion types who think that all retailers make 3000% on everything and should be punished every way possible for staying in business.

 

[.Spiralling.]

i agree, this is the way it is with my site and again no complaints. in my view, if you charge for delivery and the goods get delivered, then that part of the contract is fulfilled, and should be seperate to the return of any of the goods.

unfortunately, the law doesn't ask you for your view, just states what you must do. It's one of the costs of online retailing and should take it into account along with the other costs. You don't pay for a B&M shop, but you do have to absorb this particular cost. On the other hand, a B&M shop has other costs to take into account, but don't have the DSR to contend with.

also, what happens if somebody buys 3 items of different prices and is charged £6 for delivery, then returns one of them for a refund but keeps the other two? would you have to split the charge based on no of items, or percentage of order value?.

I would imagine that if you charge a flat rate for delivery, then the return of one item from several means that postage need not be refunded, because they would have incurred that cost anyway when they bought the other items.

If you charge per item or by weight, then I should think you would need to work out the pro rata postage and refund that.

 

[deniser]

You don't pay for a B&M shop, but you do have to absorb this particular cost. On the other hand, a B&M shop has other costs to take into account, but don't have the DSR to contend with.

Unfortunately many of us have both with the online sales being the only way we can keep the B&M shop open!

 

[.Spiralling.]

I know and I know the costs do add up.

I just think that if you're going into business you should take these costs into account.

 

[Steve2507]

I know and I know the costs do add up.

I just think that if you're going into business you should take these costs into account.

I agree with what you are saying. There seem to be people on here that are simply putting their head in the sand. by saying I don't think it's fair doesn't change the law. I also think it isn't fair but it's the law and so we get on with it (although some of the things we sell aren't covered).

For all those that are winging and whining about it there is a simple answer that will ensure it doesn't affect you and guarantees that you will not have to refund any postage costs. Stop selling online/via mail order.

 

[katewaugh]

Duongo is right - don't know where the thing about having to refund postage on returns came from! You only do that if the item is faulty!

 

[deniser]

Kate I don't think you have read all the posts?

I have learned something new from this thread (much as the whole thing seems irrational but I can see that the legislation is probably aimed at certain types of products) and am rewriting my T&C at the moment. As Steve says there is no point hiding your head in the sand until Trading Standards come knocking at the door.

 

[katewaugh]

You're right, I haven't - there's rather a lot to wade through!

 

[.Spiralling.]

You're right, I haven't - there's rather a lot to wade through!

Then perhaps you should, it seems that you misunderstand what is required of you.

 

[katewaugh]

Mmm, thanks very much - thought I was coming on here to make friends - clearly I misunderstood that too.

 

[Steve2507]

Mmm, thanks very much - thought I was coming on here to make friends - clearly I misunderstood that too.

Yes you will make friends on here, but also get very good advice (usually).

I firmly believe that it is better to receive proper advice than advice which you want to hear.

 

[katewaugh]

The point I was making to deniser was that I accidentally failed to read all the posts because there was so much to wade through - I didn't deliberately skip information or make inaccurate comments! I've said nothing about giving or receiving only advice I want to hear!

 

[lesliedocherty]

you stick on your terms that if the customer wants to rturn it for unsuitableness, they pay return postage and you dont refund the initial postage.

and leave it at that

 

[.Spiralling.]

Mmm, thanks very much - thought I was coming on here to make friends - clearly I misunderstood that too.

I wasn't trying to be unfriendly, and honestly don't think I was being. My point was that by not reading all the posts, you may well have missed those that contain the correct information.

i.e. customers can return goods bought online, mail order etc for any reason if they notify you in writing within 7 days of receipt, and they are entitled to a full refund, including the postage.

However, if your T&Cs state they have to pay the cost of returning the item, then you at least don't have that cost. If you don't put it in your T&Cs, you have to pay the cost of having them returned.

 

[UKSBD]

If you don't put it in your T&Cs, you have to pay the cost of having them returned.

If it's not in the terms and conditions the customer doesn't even have to
return the product, they only have to make it available for collection.

 

[.Spiralling.]

good point!

 

[crazy4bargain]

Your comment was very useful. Will the local trading standard check your T&C's for free.

 

[furman]

Good info.