Product returns are a fact of business life in direct selling, multilevel (MLM) and party plan companies. Returning merchandise via the USPS is an annoyance to the customer. First, if the order has been opened, the product has to be carefully re-wrapped; next, it has to be taken to the Post Office, where long delays may be encountered; and finally, the customer has to pay the return postage and insurance. This article explores ways to reduce this burden and irritation.
Naturally, the goal is a happy customer, ecstatic MLM distributors and thrilled Party Plan consultants. If you pause to think about it, the better job you do of keeping your promises, the better chance you have that expectations will be met because promises are kept. This begins with product that fulfills the promise, compensation plans that do what they say, and fulfillment on time every time. Visualize the customer receiving his or her order-or commission check-opening the box-or the envelope-and experiencing excitement or disappointment. Every element leading up to that experience must be in your focus as you design the system for fulfilling your promise.
With this foundation laid, consider how to handle disappointments to minimize their impact, and with the hope of keeping a customer for life, and therefore, keeping productive MLM distributors and Party Plan consultants for life.
Marketing studies have indicated that anxiety about returning unwanted merchandise and the actual chore of doing so are two of the major deterrents to at-home, long-distance shopping.
In an effort to alleviate some of this problem, companies are offering customers and distributors one or more of the following options: (1) USPS Merchandise Return Service; (2) UPS call-tag service; or (3) acceptance of returns at the company’s retail stores or will-call centers.
- U.S. Postal Service (USPS) Merchandise Return Service.
To utilize this service, a company completes Form 3625-Merchandise Return Permit Application, obtainable at any Post Office. There is an annual fee for the permit. Package-return charges are regular postal rates plus an additional small charge. Return charges are paid through an advance deposit account established by the company.
A return label is sent to the customer with the merchandise or mailed subsequently when the customer obtains permission to return. Return label requirements are described in the Section 919 of the Domestic Mail Manual. Customer affixes label to the package, places in mail box or delivers to Post Office. USPS delivers to company and deducts charges from the company’s deposit account. There must be sufficient funds in the deposit account or the package will not be returned.
This service simplifies the addressing of the return package, eliminates the postage cost, and sometimes relieves the customer of the burden of going to the Post Office. The package can be put into a mailbox.
- UPS Call Tag Service.
After a request is received from the customer, the company notifies both UPS and the customer. UPS picks up at the address given by the customer (where someone is available to turn over the package-either home or office) and delivers the package to the company. UPS will make three pick-up attempts before the company has to issue another call tag. Cost of the service is the same as the outbound delivery charge.
[box] An Important Note About Your Policies on Returns and Refunds
The call-tag service is widely used by companies for customers who are not satisfied with merchandise. Total cost is born by the company. To keep a level playing field in the network marketing game, companies regularly only issue UPS call-tags when the merchandise pick-up is necessitated due to an error or oversight by the company. Given the layer of complexity added by MLM commission plan and Party Plan compensation considerations-namely, that an order is placed not only because the customer wants the products, but also because the order is placed by the MLM distributor or Party Plan consultant who is attempting to qualify for their commissions-the cost of returns should only be borne if your company policy is so stated (not likely) or if you make a mistake. Otherwise, you would be making it too easy for consultants, field reps, and distributors to play the game of placing a qualifying order, thereby earning the commission volume, returning the product, and getting a refund.
For this reason, your company will have counter-balancing policies, not the least of which is the policy that a distributor must cancel his or her distributorship in order to obtain a refund. There really is no way around it. Bear in mind that you are not precluded from carrying a credit on account, particularly to accommodate those distributors and customers who receive an order and who truly have an issue with the product received. So long as you are not paying out cash refunds, you should be happy to carry a credit on account to be used strictly for exchange for products with equivalent cost and volume considerations. The natural extension of this analysis is that the exchange can only be for commissionable products, and not sales aids and non-commission-volume items.
The call-tag service makes the return process markedly simpler-no charge and avoidance of the inconvenience of delivering to the Post Office. The package, however, still has to be securely wrapped. UPS also has a merchandise exchange service. This is particularly applicable for products needing repair or where an even exchange is involved. Here is how it works: (1) your customer contacts your company requesting an exchange; (2) your company ships the replacement via UPS with instructions that it is to be an exchange; and (3) the new item is delivered to your customer and the item to be returned is handed to the driver at the time of delivery. The company is billed for the normal delivery of both products plus a small service charge.
- Acceptance at Your Company’s Retail Store or Will-Call Center.
This service is not universally available, but must be considered. This is because some companies have at least a small store front associated with the corporate office, or even if they don’t, they have distributors who come to town to “look you over” and while there, wish to place orders. In a few rare instances, a difficult distributor or customer will bring the return to your corporate office. Hence, brief mention is made as to how you might handle these situations.
Well-established leaders in our industry are likely to accept order returns at their stores or will-call centers and offices for any reason. Of course, these locations are not convenient to at-home shoppers, and they reside outside the standard model for conducting long-distance business that reaches across the nation.
However, when a customer shows up, the most satisfactory solution to the customer’s return problem-or any other problem-is to keep your company’s service reputation soundly intact, win a friend, and take care of the customer. Period.