By Herb Weisbaum ConsumerMan
msnbc.com contributor
updated 12/26/2007 8:59:13 AM ET 2007-12-26T13:59:13

Now the real fun begins — taking back the unwanted gifts you received and cashing in on the after-Christmas sales. This year, stricter retailer policies may mean fewer happy returns.

“Many retailers have become more persnickety about receipts,” says Greg Daugherty, Executive Editor at Consumer Reports. They won’t give you a refund or let you make an exchange without one. If you didn’t get a gift receipt, you’ll need to ask the person who gave you that present for the sales slip.

Stores that accept returns without a receipt normally refund the lowest sale price. That can be significantly less than what you’d get with a receipt. And in most cases, they’ll only give you a store credit.

Most major retailers relax their return deadlines for holiday purchases. In some cases, you have until the end of January to bring back general merchandise. But there’s often a much shorter return period for electronic items.

At Wal-Mart, you get 90 days to bring back most things, but only 30 days for camcorders and digital cameras. The return period for computer hardware, GPS units, digital music players, and portable video players is just 15 days.

Costco, which has a very liberal return policy on most items, now puts a 90-day limit on TVs, computers, cameras, and other electronics. “We’ve had a very serious problem with electronics,” Costco CEO Jim Sinegal tells me. “When one of these items comes back, you take a big hit on it.”

This year, Best Buy bucked the trend and expanded its holiday return policy to cover everything except special order or non-returnable items. In the past, computers and many other products had to be returned with 14 days and were excluded from the extended deadline of January 31st.

Those dreaded restocking fees
Get an electronic gift and simply open the box and you should expect to pay a restocking fee — normally around 15% of the purchase price — to return it.

“So if Aunt Tillie winds up giving you a two mega pixel digital camera, which is yesterday’s technology, don’t make her feel good by taking it out of the box and fawning over it,” advises Edgar Dworsky, founder of ConsumerWorld.org. “Leave it sealed! Bring it back in the unopened box if you want full credit.”

If that digital camera came from Office Max this is especially important. They won’t take back a digital camera if the box has been opened, unless the camera is defective.

Restocking fees are not limited to electronics. Sears charges a 15% restocking fee on all sorts of merchandise, including some home appliances, lawn and garden equipment, and sporting goods.

Note: You have the right to expect a defective item to be replaced without incurring a restocking fee.

Are you a frequent returner?
If so, you may be stuck with that unwanted gift, especially if you don’t have a receipt. Some big retailers now use computer programs to monitor returns and catch those who they feel abuse the system. If you’ve exceeded the store’s limit, the return is rejected.

Consumer Reports says Wal-Mart, Kmart and Lowe’s do this. According to ConsumerWorld, Home Depot, Barnes & Noble, Sports Authority, KB Toys, The Limited, Express, and some Staples stores also track returns.

So how do you know if a store does this? And how many returns are too many? Customers are rarely given this information. This really frustrates consumer advocate Edgar Dworsky. “How about a little advance warning about what it takes to get on their ‘blacklist’ of serial returners?”

Dworsky applauds The Limited and Express clothing stores for disclosing their return limits – even though, he says, it’s done on inconspicuous signs and the back of receipts. Customers get five returns within any 90-day period with a receipt or up to $300 without a receipt.

Why are stores cracking down?
Returns are a hassle and they cost the company money. The Return Exchange, a company in Irvine, Calif., tracks returns for various national retailers. The company’s public relations office said it could not find anyone to talk to me about its services, so the information that follows is from the FAQs page on its Web site.

TRE doesn’t name clients, but it says every mall in the U.S. is likely to have at least one store using its Verify-1Return Authorization System. Thissoftwareis designed “to identify the one percent of consumers whose behavior mimics return fraud or abuse — a $17.3 billion/year problem in the United States.”

The company says the system uses verifiable information, such as frequency of returns, the dollar amount, and whether the customer had a receipt, rather than guesswork by a sales clerk. “This objectivity ensures that only those with highly suspect return-and-exchange behavior are affected.”  TRE states that it does not share data among retailers – but since this voluntary policy could always change in the future.

You can find out if TRE has information on you by sending an e-mail to returnactivityreport@theretailequation.com. Include your name and phone number where you can be contacted. When the company calls back, you’ll be asked to provide your driver’s license number to begin the database search.

My two cents
Retailers aren’t stupid — well, most of them aren’t. They don’t want to lose customers. They’ve been forced to institute stricter return policies to deal with the growing problem of return fraud and return abuse.

Besides outright criminal activity, a small percentage of customers try to beat the system. They buy things they have no intention of keeping. A common example is the person who buys a digital camera to use at a graduation ceremony and then returns it a few days later. The industry calls this renting.

I have no problem with policies that deter thieves and penalize the knuckleheads who try to play the system. We all pay for this fraud and abuse in the form of higher prices. But if a store is going to track my returns and blacklist me if I violate their rules, I need to know what those rules are. This information needs to be prominently displayed — posted at checkout, printed in bold type on the back of my receipt, and spelled out on the company’s Web site. Secret policies aren’t fair to anyone.

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