The National Retail Federation expects between 4 and 6 percent of the $217 billion worth of holiday gifts will be returned after the holidays.
By Jon Bonné
updated 12/29/2003 1:10:16 PM ET 2003-12-29T18:10:16

The gifts were given, the holiday spirit lingers. Now comes the unpleasant aftermath. It was so thoughtful of your cousin to buy you that CD box set of Alpine yodeling, or maybe you thought your sister would really like a polka-dot turtleneck, but that stuff is headed back to the store faster than you can say, "Thank you, come again."

Braving the return counter remains a daunting experience. Store policies have become mind-numbingly elaborate, and just because you didn't have time to read the fine print in the pre-holiday rush doesn't mean you'll have any luck in getting your money back.

With 4 to 6 percent of gifts being returned amid a projected $217 billion holiday season, according to the National Retail Federation, you'll have a lot of company in line.

"Ninety-plus percent of consumers will sign on the dotted line and can't absorb what's put in front of them," said Edgar Dworsky, founder of Consumer World, a nonprofit advisory service. "It's not just, you buy it, you return it, you get your money back. ... That was the old days."

Many stores won't accept returns of some opened merchandise, such as music or video games. Office Depot will only exchange opened digital cameras and software for the same item.

Others charge a restocking fee -- usually 15 percent -- for electronic items. Both Target and Best Buy, for example, levy them on some products. And lots of luck trying to bring back a gadget that's been opened and played with.

Meantime, Target prompted some frustration when it decided that seasonal merchandise marked down during the holidays would be refunded at the clearance price, even if a customer paid full price. That policy has been discontinued, according to spokeswoman Lena Klofstad. But it was still visible Tuesday on Target's Web site and apparently still posted in some stores.

"I think it's very important for consumers to know what the returns policy is before they walk in the door," said Scott Krugman of the National Retail Federation. "Knowledge is power, and it's going to empower them to have a better experience with that retailer."

Extending deadlines
At the same time, some retailers have tailored their return policies to be more consumer-friendly amid increased competition and customer demands. Circuit City canceled restocking fees in 2001.

And while a 30-day limit for most items remains a standard for many stores, others have extended their return deadline. Costco has no deadline for returns, save a six-month limit on computers, perhaps because all customers must be card-carrying members of the warehouse chain. "We do our best to take everything back," said John McKay, general manager of Costco's Northwest region.

Retail giant Kohl's also provides no deadline for returns, so long as customers have a receipt. Both Target and Wal-Mart allow shoppers to return most items up to 90 days after purchase.

Major Market Indices

"Ninety days is really very generous," Dworsky said. "They really could be shooting themselves in the foot on seasonal things like clothing."

Growth in online retailing has also sharpened focus on return policies. While some consumers still find difficulty with returns from online-only stores, Internet retailers have taken great strides in improving the return process -- including, for example, pre-printed return labels with shipments.

At the same time, online outlets of brick-and-mortar retailers have become increasingly popular: Shoppers can avoid the crush of store aisles, yet have somewhere to easily get a refund if their new food processor short-circuits.

More customers are also evaluating their overall shopping experience online. Many e-commerce search services now rate retailers based on customer feedback that often weighs heavily toward their overall satisfaction with a purchase.

"What we're seeing is a shift away from using price as the primary arbiter of where people buy things," said Nirav Tolia, chief operating officer of, "and toward what I call the soft benefits: toward customer service, toward shipping, toward tax."

Avoiding a hassle
Shoppers -- and gift recipients -- can ease the returns process with some careful forethought.

  • Save those slips: Don't throw away any of your receipts from holiday shopping. Trying to get a return without a receipt can be difficult, to say the least.
  • Gift receipts: With over two-thirds of adults saying they prefer to get a surprise gift, according to a recent Gallup poll, it's especially important for buyers to get a gift receipt, which shows the item but not the price. Recipients can use them to trade in their gifts, and most stores will provide one on request. Some, like Kohl's, give them to almost all customers during the holiday season.
  • Don't delay: With some return windows as small as 14 days, it's important to get unwanted items back to the store quickly. You don't necessarily need to join the Dec. 26 insanity, but don't wait too long past New Year's Day. Even if the item is defective, it can be hard to make your case if you're bringing it back a couple months later.
  • Leave it be: Think twice before you tear off that packaging, especially for video games, music or books. Many stores state in their return policies they will only issue store credit for opened items. Others have specific restrictions on certain products.
  • Beware the bargain: Clearance items often are restricted to extra return limitations. Some retailers, especially online, may be selling remaindered products that no longer have their original warranties. Some electronics makers only honor warranties from products sold by authorized dealers, which clearance houses often are not.
  • Join the line: It's frustrating to wait behind the rope, but most big stores have return counters specifically to help speed the process, and with good reason. Asking for a refund from a salesperson on the floor can be an exercise in frustration for everyone, especially if you're the next person in line, trying to buy something. Customer reps at refund counters usually can process your request fastest, know return policy details and, because they're not also handling sales, want you out of line quickly. "The last thing they want is someone to start making a scene," Dworsky said.

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