Let’s be honest. Most people wing their sales policies. They use feedback, usually from buyers to determine which policies to adopt. Or, they use their experiences as a consumer in the marketplace to determine their policies. It’s a problem to graft consumer expectations into wholesale. Designers who use email to pitch buyers with a big song and dance (brand story blah blah blah) are similarly guilty. It’s easy to understand why people do this if being a consumer is their only transactional experience.
Other than the obvious (selective reporting by retailers) buyer feedback can be a problem because its quality can be all over the map. The reality is, when most of you start out, you begin by selling to a range of smaller independent retailers. However, who is to say these buyers know much themselves? How long have they been selling? How much do they know? In the end it can be a situation of the blind leading the blind. Here’s one example I found recently.
We had a customer who ordered $1500 worth of products. About 90 days later, the customer called wanting to return the entire order because their customers returned items due to damages. Our return policy states that all returns must be made within 30 days of order but we completely understood so we agreed to apply a credit to their account for future purchases.
I think this wholesale sales policy should be reconsidered.
As a vendor, you control conditions of sale to which your customers can agree or disagree which is how they determine whether they will do business with you. As it relates to wholesale returns generally, you shouldn’t take anything back (ever) unless it is due to defects. Anything else amounts to a consignment agreement. So, on wholesale non-defective goods, no returns period.
However, the return of defective goods should not be subject to such a limited time frame of 30 days. This is not reasonable for a retailer. It will take time for them to sell the goods and once in the hands of end users, time to determine performance after which the goods may be returned to the retailer who then returns the items back to you. I advise manufacturers to guarantee their products for at least a year. If the return is within 90-120 days, a cash refund (if requested) is not out of line. Larger brick and mortars will take it out of your hide with chargebacks for longer periods than that leaving you with little say in the matter.
About their wanting to return the whole order (it is not known if non-defective goods were included in the returns request), this amounts to a lack of confidence. Wanting to return the balance of the order is typical because they don’t want to become known as purveyors of dubious merchandise. If x percentage of product is returned by consumers, retailers will want to return all of your products they have in inventory. So this actionable response to a crisis of confidence has long standing precedence in the practices of retail relationships.
As they are way over the return time frame, we agreed to provide a courtesy credit to the account for new merchandise and a refund for all defective products (without restocking fee too!).
You should never charge or deduct the cost of a restocking fee on defective goods so the fact that you did not was not a demonstration of good will. Restocking implies you’ll resell defective goods. Perhaps it’s better described as a fee to process the return but again, if the goods were not defective, they would not have been on the hook for it -in short, not their fault. In this case, I suppose it wouldn’t be inordinate to charge restocking on the return of goods not determined to be defective but declining to do so is what could be construed as good will.
Now they threaten to take us to small claim court, do they have any ground for that? Should we really refund the entire amount?
Technically, you control the conditions of sale to which they agreed when they ordered from you. Does it mean an impartial party will agree it is fair? Who can say?
Also, they have began to post negative comments about us in various places. Any suggestions on how to resolve this?
More to the point, it appears the customer has burnt their bridges and does not want to do business with you any longer. They are holding you hostage in the realm of public opinion. Is this a customer you want to keep? Considering their tactics, is this someone you want to represent your products? [As an aside, they use comic sans on their site in horrid blue font. Is this the image in which you want your products represented? People who are unprofessional are unprofessional in many ways.] Only you know whether it is worth the grief of forcing this customer to do business with you. Personally, I’d take the goods back, refund their money and then return the product to my vendor if it was clear they didn’t meet spec. I’d write off the balance and call it a lesson learned. If your vendor won’t take it back, that says all you need to know.
Caveat: I am undecided as to whether one should print a returns policy for defective goods on their sales forms because this could imply defects are common enough to warrant the necessity of a policy. Perhaps it is more appropriate to state that workmanship and construction are 100% guaranteed for X amount of time.
Establishing wholesale terms and sales policies -there’s lots of links here, an all-in-one post.