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Your small business return policy is a set of guidelines that tells customers what to expect if they want to make a return or request a refund. Potential customers often look for return and refund information before making a purchase. This is especially true for online stores since they can’t see your products in person first.
A clear return and refund policy includes details on what’s returnable, how you process refunds, timelines, and shipping costs. We’ve included a return policy example below.
Note: Our return policy example is just a starting point, and not meant to be used as a return or refund policy template or legal advice.
What to put in a return and refund policy
The goal of your store’s return policy is to anticipate any questions your customers might have about the refund or returns process. Your return and refund policy should cover:
What’s eligible for return: Is everything you sell returnable? Someone who sells perishable or custom products could specify that they’re final sale, for example.
Acceptable return condition: Specify if you’ll only accept returned items in a certain condition. For example, only in the original packaging or clean and undamaged.
How to make a return: Lay out your process. Some businesses ask customers to send an email, while others have a form or third-party extension to manage returns. Mention if you accept in-store returns if you have a brick-and-mortar store. If so, do they need to bring proof of purchase?
Return shipping costs: Clarify whether you’ll cover return shipping for customers. You can do this by either refunding their shipping costs or providing a shipping label. Providing prepaid return labels is generally best for customer satisfaction.
Other return fees: It’s ideal to offer free returns, but some small business owners charge a small restocking fee to cover the cost of processing returns.
Return deadlines: Be clear about any time limit to making a return. Common windows are within 30 or 60 days of purchase.
Refund policy: Do you offer a full refund for any returned products? Some business owners only offer a partial refund or exchange after the return timeframe ends. Do you offer cash refunds on a credit card or do you offer store credit?
Refund processing time: Let customers know when they can expect to receive their refund. Factor in the time it takes you to process a return and the time payment processors need to refund the money.
Exchange policy: If you offer exchanges, specify the exchange terms. For example, you can offer to exchange for a similarly priced item or a different version of the same item.
Return and refund policy example
The policy example below is not meant to be used as a return policy template or taken as legal advice. However, it can be helpful to see how other businesses handle returns, so we’re offering this example of a standard return policy for educational purposes.
“Didn’t love what you ordered? Our store is happy to accept online returns within 60 days of your purchase date for a full refund, exchange for an item of equal value, or store credit. Items returned after the 60-day return period are not eligible for a refund or exchange. Items must be returned in undamaged and clean condition.
To make a return, please email [EMAIL] with your order number. We’ll help you process your return and provide a free shipping label for your purchased item. Simply repackage your item and drop it off at the post office. Once we receive your return, please allow 3-5 business days for processing. If your return is accepted, please allow 3-5 business days for a refund to appear on your original method of payment.”
Remember, this return policy example isn’t meant to be a template or legal advice. Make sure you follow state laws or retail regulations wherever your business is located.
See examples for a refund policy
How to communicate a return policy
Make your return policy easy to find on your website by linking to it in multiple places. We recommend linking to your return and refund policy in your website:
Consider adding a link to any other places where you communicate with customers, like email or social media. Add a link to your marketing email footer or your social media account’s link in bio.
Why small business return policies matter
A clear return policy builds trust and customer loyalty for your business, especially for ecommerce businesses. When customers trust that they can make a return with little hassle, they’re more likely to buy from your store.
Having a clear and specific return policy also protects you as a business owner. Depending on where you’re located, you may be required to have a return policy. If you don’t list a policy, a policy supplied by the local government may apply.
A return policy also protects your time by answering any questions customers might have in advance. And you protect your business by naming the terms under which you’ll accept and process returns.
See our full guide to setting up shipping for your online store