Many Unhappy Returns

The greatest return policy in the history of retailing is over. In a move to appease analysts and Wall Street, Costco has amended its long-standing return policy. You used to be able to return anything to Costco at any time, even without a receipt, and get a full refund for the product. Unfortunately, the scenario that too often played out was that a customer would purchase an HD TV for example, then return it nine months later when prices have fallen enough that the person could upgrade to a bigger, better TV for less money. No questions asked. The only exception was computers which had a six month window for returns. Electronics represented about 5% of Costco’s total sales and the abuse of the return policy was hurting the bottom line.

http://www.msnbc.msn.com/id/17350641/
http://www.costco.com/Service/FeaturePageLeftNav.aspx?ProductNo=11204333

The new policy will give customers 90 days to return televisions, computers, cameras, camcorders, portable music players, and cell phones. Costco will also extend the warranties on TV’s and PC’s for two years to help make the transition.

The former return policy was legendary among loyal Costco shoppers as well as deal hunters. Unfortunately, like many good things, the few have spoiled it for the many. And I just bought a TV at Costco three weeks ago (seriously, I did). So if and when that TV breaks in two years and two months, I’m coming after all the people that abused the policy and thus incited the change. Assuming 100,000 or so abused the policy over the last couple years, that’s approximately 18 cents a person that you’ll owe me. I’ll talk to you in a couple years.

You’re welcome.