Customer wants refund - Page 4

Sorry for what you are going through, there are people like her everywhere, thank goodness there are not a lot of them and most people respect and are encouraging of the work that goes into doing what we do. I have had this problem also and it isn't pleasant to go through, it makes you greatful for all the good people you come across in this business. Stick to your guns, and all will be well. She needs to produce that cake she says wasn't up to her expectations. You did a wonderful job.

I think you're lucky word didn't spead about your generous return policy.  BTW I'd like to order a cake... 

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Costco also has a very generous and well-known return policy, and it is one of the most profitable retailers in the world. (I'm comparing general business practices here, not cake quality.)

And did you happen to notice how many people were lining up to return 70" tvs the day after the Super Bowl at Costco? It was a lot. 

That's exactly my point. One of the reasons Costco is so successful is that the return policy's added value due to honest customers (people are more willing to take a chance on a product if they know they can easily return it if they aren't satisfied) significantly outweighs the extra cost incurred by people who abuse the system. As you noted, this extra cost is not trivial.

If the cost was greater than the benefit they would get rid of the return policy entirely or scale it back. They actually did this with computers and TVs, but the 3 month return policy for these products is still far more generous than their competition.

Costco's profit margin is only something like 2%, they also don't lose all the money they made on a returned product, some are refunded by their vendors and some are sold to salvage companies.

They quite often only make a couple cents on an item, but because of the thousands of items sold each day, those cents add up quickly. I don't know any cake company that can sell that amount, survive with that profit margin, or salvage any money lost on a returned cake. Or for that matter, one that charges customers over $100 a year just to order from them.

Being willing to go the extra mile to make a customer happy is extremely important in the success of a business, however, I just don't see how costco and a small business that sells wedding cakes can be compared.

Costco can resell those returned TVs.  They are not out any money.

The analogy was from the perspective of how businesses can be successful offering guaranteed satisfaction to customers via their return policy. The fact that Costco is high volume means more customers and more opportunity for abuse of the return policy, but their success indicates that those who abuse the system are a tiny minority and the benefits outweigh the costs.

Some returns can be resold, but Costco is still out the labor involved in dealing with the return, repacking, and restocking if the item is even still in saleable condition. Some returns cannot be resold, like food -- anyone who buys a cake from Costco can go back the following day and get a full refund, even if the cake is gone, but people are basically honest and very few people will actually do this.

It is true that returns will disproportionately impact the bottom line of a low volume business, which is another reason why it's so important to target your marketing at customers who are willing to pay for quality.

But people who are honest don't go back the next day and get a refund for a cake that was eaten.  Dishonest people do.  You are rewarding dishonesty.  It doesn't really matter what your target market is.  People will willingly spend $500+ on a cake to impress their friends if they know they will be refunded the next day.  I agree it's a minority, thankfully.  But it's the principle of the thing.

as a consumer i am not attracted at all to a bake shop with a guaranteed return policy

 

i want a bake shop that's gonna deliver first time

 

i have a party to plan and enjoy and i want to hit the mark--i don't get a second chance to celebrate

 

if they have a brilliant return policy that's my sign to go elsewhere

 

imo

It really depends on the framing. Obviously the policy is not going to say something like "we'll take it back if it sucks", the message is "we are so confident that you will enjoy our product, we'll give you your money back if you don't".

That's standing behind your product.

in our line of work we are selling to a fleeting window of opportunity

 

if that is blown for whatever reason it is not really recoverable

 

imo

edited to say--this post and the previous two of mine, #57 & #59  are not directed to op--just off on a relate-able tanget re: return policies

 

i don't want my money back i wanted to enjoy my party and eat decadently

 

screw the money just don't screw my moment (you figuratively)

 

it's just not the guarantee i'm looking for in a celebration cake

 

when i buy a car yeah, a tv, a new coat yes

 

you better freaking know i'm getting my money back if you (figurative you) screw my celebration

 

we are marketing a tasty ambiance and sparkle and decadence and aroma and flavor and mood enhancer we are selling to enhance a moment in time

 

when the moment is gone it's all over cannot be replayed

 

that's imo

Edited by -K8memphis - 2/25/13 at 8:39am