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How Resellers Can Better Handle Hardware Returns

Retailer returns are straightforward: the customer presents a receipt, the product and the original method of payment. With all three things, the cashier can refund the transaction within x-number of days.

Unfortunately, hardware returns through a provider are more complex. In most cases, the hardware is a vital part of the service, meaning the return process might determine if that customer stays. Therefore, it is essential to save the relationship by proposing alternatives and understanding where the product failed.

Clarify Your Return Policy in Your Contracts and on Your Website

Customers who do not know your return policies will challenge them. They will assert their ignorance and seek compensation for it. If explained at the point-of-purchase, though, a clear policy will avoid these arguments.

For no-reason returns, your policy should reflect the distributor with which you work. If you can ship products back within a defined period, then instruct your customers to do so. You may need to mediate the exchange to ensure products are returned in full, but the process is still linear. Any extra conditions you set should depend on the effect returns have on your business.

Restocking Fees

Some resellers charge a restocking fee for no-reason returns to cover distributor processing fees. More commonly, restocking fees get introduced when the business cannot return the hardware at all. If a product must sit in your own inventory, then you need to set fees to offset its overhead. After all, you cannot flip an open-box product at retail value.

Considering as much, some businesses forecast hardware depreciation and create return policies around it. For instance:

  • Full refund within the first 30 days;

  • Between 30 and 60 days, a 15% restocking fee applies;

  • After 90 days, the restocking fee rises to 50%.

Resellers with channels to sell used equipment can increase their customer satisfaction with such a model. But there is a caveat: hardware that comes with software is typically single-seated. This means that once it is installed, the software cannot be transferred to another machine.

Software is an afterthought to many customers; it might not occur to them that using it will void the return agreement. The longer the customer has the product, the more likely they will be to license the software.

Defective Hardware

Contrarily, software does not matter for defective hardware. When there’s a hardware issue, the policy comes from the manufacturer directly—no need for interpretation. Whether for exchange or repair, you will need to ship the product to the proper department. This task involves more customer service than sales.

Make Better Recommendations to Avoid User Frustration and Dissatisfaction

The likelihood of a return increases when you fail to identify the needs of your customers. If your customers care most about price, then top-tier hardware will divert their attention to cheaper products elsewhere. You want to always avoid the question: “Why didn’t you mention this product instead?”

Another example might involve feature sets—those apropos of today and tomorrow. Without recognizing how your customers might grow, your hardware will restrict them. If you sell a phone with three lines to fit a customer’s budget today, they may come back in six months looking for more lines. Such situations are tricky because this time period surpasses the refund window. Unless the customer saw the limitations early, the product becomes non-refundable. Either way, it is a negative experience and undermines your expertise.

User Training

Another common cause for return is lack of user training. If your customers cannot figure out how to use the product they ordered, they will want to ship it back. Again, this boils down to knowing your customer base.

If your customers want simplicity, then robust products will overwhelm them. The opposite is also true: those craving features will find basic hardware restrictive. The more your customers learn their hardware, the fewer returns you will need to accept.