Returns, and the rule you cannot opt out of

Where returns are concerned, the law differs more between markets than almost anything else in this topic. In some places a customer has a legal right to change their mind; in others they have none at all and your published policy is the whole of it. Selling to several countries means knowing which you are in.

The three positions, which are genuinely different

Not variations on a theme. These are different legal structures with different consequences for how you write a policy.

• A statutory right to withdraw without reason. The EU and the UK. A consumer buying at a distance may return for any reason within a set period, whatever your policy says.
• No general right to change your mind, with separate guarantees for faulty goods. Australia is the clearest example: the ACCC states plainly that businesses do not have to offer refunds for a change of mind, while rights for a major problem remain and have no fixed expiry.
• No broad federal right at all, with narrow exceptions and state law on top. The United States. The FTC's Cooling-Off Rule gives three business days, and only for sales made at the buyer's home or workplace or at a seller's temporary location such as a hotel room or fairground, at 25 dollars or more. It does not apply to ordinary online retail.

So the same shop selling the same product has a mandatory fourteen-day no-reason return in Berlin, no obligation to accept a change of mind in Brisbane, and no federal obligation in Boston. Most advice online describes one of those three as though it were the rule.

The EU and UK rule, in detail

Under the Consumer Rights Directive, a consumer buying at a distance has 14 days to withdraw from the contract without giving any reason. For goods the period runs from the day the consumer takes physical possession, and where one order is delivered in several parcels, from the day they receive the last item.

The detail worth knowing, because it is where the expensive mistakes are: if you did not tell the customer about the right of withdrawal as required, the period is extended by twelve months. A shop with no returns information does not have fewer returns. It has a year of them.

The exceptions, which are narrower than people hope

• Goods made to the customer's specification or clearly personalised.
• Goods that spoil quickly.
• Sealed goods that are not suitable for return for health or hygiene reasons, once unsealed. The Court of Justice has held that this is to be read strictly, so it is not a general escape hatch for anything in a wrapper.
• Digital content not on a physical medium, where the customer gave prior express consent to immediate supply and acknowledged losing the right.
• A service fully performed, where performance started with the customer's prior express consent and their acknowledgement that the right would be lost.
• Goods whose price depends on financial market movements.

Note what is not on that list: sale items, items the customer simply changed their mind about, and anything whose box has been opened in the ordinary way. Those come back.

Designing a policy that is both lawful and cheap

1. 01Meet the minimum clearly and say it plainly, including who pays return postage and how a customer starts a return.
2. 02Decide whether to be more generous, as a commercial choice, and price it in. A longer window is often cheaper than it looks because fewer people act in week five than in week one.
3. 03Attack the causes rather than the policy. Most returns in clothing, footwear and anything dimensional are the result of a page that did not say enough: measurements, materials, what it looks like next to a known object, what it is not suitable for.
4. 04Record the reason for every return in a short fixed list rather than free text. A month of that data tells you which product pages are lying, which is the only route to fewer returns that does not also cost you sales.
5. 05Make the process easy. A difficult return produces a chargeback, which costs more than the refund and damages your standing with the processor.

The arithmetic of generosity

Illustrative. On an order of 40 with a contribution of 16, a return costs the contribution plus the return postage of 5 plus the handling, so roughly 23. If a clearly stated, easy returns policy raises conversion even slightly, the extra orders pay for a surprising number of returns. If it raises returns without raising orders, you will see that in the data within a month. Either way it is a measurable question, not a matter of temperament.

National law can be more generous than the directive and some countries implement details differently, so check the rules where you sell. The 14 days is the floor, not the specification.

Writing one policy for several markets

Two workable approaches, and the choice is commercial rather than legal.

1. 01One policy, built to the most generous requirement that applies anywhere you sell. Simple to state, simple to administer, and you accept returns in markets where you need not. For most small shops this is the right answer, because the cost of the extra returns is lower than the cost of running two systems and getting them wrong.
2. 02Different policies by market, stated clearly on the pages those customers see. Lower returns cost, and it requires that your shop reliably knows where somebody is and shows the right terms, including in the checkout and the confirmation.

What does not work is a single policy written to the least generous market and sold into the most generous one. The statutory right applies regardless of what your page says, so you end up with a published policy that is simply wrong, which is both a compliance problem and the thing a customer screenshots.

What has to be said before the order, not after

The directive does not only create a right, it creates a duty to inform, and the information has to reach the customer before they are bound by the contract. A confirmation email is too late, because by then they have already paid.

• That the right of withdrawal exists, how long it lasts and how to use it.
• Who bears the cost of returning the goods, which is the clause that costs you money if it is missing.
• The total price including taxes and all delivery charges, before the order is placed.
• Who you are and how to contact you.
• When the goods will be delivered.
• That the order places an obligation to pay, which is why the final button should say something like pay now rather than something vague.

Most of this is a page and two sentences in the checkout, and the absence of it is both a legal exposure and a conversion problem, since every item on that list is also something a cautious buyer wants to know.

Separately from withdrawal, and often confused with it, there is a conformity guarantee for goods that do not match what was described or do not work. That is a different right with a different period and a different remedy, and it does not disappear because the fourteen days have passed.