How to create a returns policy for your online business

If you run an online business, the policies you create impact the customer experience you deliver. Research by ShipStation and Inside Retail has found that 57% of shoppers pay close attention to the returns policies of brands they’ve never shopped with before. Here, we offer tips for creating your returns policy to help you meet customer expectations in a world where online shopping is on the rise.
· 29 June 2022 · 5 minute read

To help improve the online shopping experiences you offer customers, it’s important to create a clear returns policy. Not only does a strong returns policy help protect your business from a legal perspective, it also assists in giving customers peace of mind when shopping with you online.

The Business Intelligence report on Customer Experience found that 84% of consumers consider the returns policy of a small business “important” when interacting with them online. In fact, returns policies were considered more important than all other aspects of online shopping experiences including free shipping, delivery times, and order status updates.

Keep reading to learn how to write a simple returns policy for your online business.


What should be included in a returns policy?

If you’re involved in the eCommerce business, your customers will want to know how your web store handles return or exchange requests as well as processing refunds. So, what should you include in your returns policy?

According to Finder, a good returns policy should answer your customers' key questions clearly, such as:

  • What is the procedure for a return or a refund?
  • How many days does the customer have to return an item or seek a refund?
  • Can the customer use their own packaging?
  • Do customers need to include the order or return slip?
  • What is the time frame in which the refund will be processed?
  • How will the refund be processed?
  • Do you offer alternative types of refunds, like store credit?

The Australian Competition and Consumer Commission (ACCC) is also a useful resource for what’s considered fair grounds for returns or refunds. Outlining these terms clearly on your website will help your customers understand the conditions of shopping with your business online.

To assist your online customers further, make sure your returns policy is easy to find on your website. Also, consider publishing it in your frequently asked question page, and referencing it again in your online checkout.


What are the benefits of a clear returns policy?

Effectively communicated, legally robust returns policies come with a host of benefits for online businesses: 

A returns policy may save you time

A direct returns strategy will save you time fielding customer questions. Should there be a mishap down the line, it can also help you to navigate any customer confusion and protect you legally.

Your returns policy may support your bottom line

Outlining whether you offer free returns or exchanges (if at all) can save you paying extra delivery fees. A well-written returns policy can be a drawcard for new customers, which may, in turn, help to boost your profit. A concise returns policy may also help to deter scammers looking to take advantage of your business.

A returns policy can help to build customer loyalty

Providing your customers with post-purchase support and a clear returns policy may help to bolster their trust and satisfaction with your brand. Meeting your customers’ needs and expectations once they’ve purchased your product is also a great way to prevent negative reviews online across social media platforms. 


Things to consider when creating a returns policy for your online business

In the Customer Experience report Ben Franzi, Australia Post’s general manager of parcel and express services, says simplicity is key to a good returns policy. “The process needs to be simple. Return labels should be easy for the customer to access and download, and retailers should be considering how their packaging may be repurposed in the event the item is returned.”


Returns policy checklist

  • Visit the ACCC website to learn about consumer rights and guarantees.
  • Refer to online guides such as Managing refunds and replacements’ by Small Business Development Corporation
  • Read the returns policies for small businesses like yours – you may be able to pick up a few tips.
  • Consider seeking legal advice to ensure that your policy covers you legally.


Ready to write or update your returns policy for your online business? If you’re not sure where to start, TermsFeed offers returns policy templates, which can help you consider what to cover. 

And don’t forget, when your returns policy is ready, try to publish it in a place where it will be easy to find. Keeping consumers informed in this way will help your business to deliver great customer experiences for those who choose you for their online shopping needs.


This article does not necessarily reflect the views of Telstra or its staff. 

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