The holiday gifts that are so easy to buy are becoming harder to return.
Retailers fighting a sharp increase in what’s known as return fraud are less willing to take some items back — especially if they’ve been unwrapped or appear to have been used.
But there are steps that gift buyers and recipients can take to make returns less of a hassle. These include keeping sales slips and gift receipts and not delaying the return of defective or unwanted goods.
Consumers may find it more difficult to return gifts because merchants are tightening their policies in response to an increase in fraud. The National Retail Federation, a trade group based in Washington, D.C., estimates return fraud costs the industry $9.6 billion a year — about a third during the holiday season.
“Some is organized groups stealing merchandise from stores,” said Joseph LaRocca, NRF vice president for loss prevention. These gangs get rid of the stolen goods through pawn shops, Internet sales sites or, increasingly, by returning the merchandise directly to stores.
Another category of return fraud involves consumers who essentially “borrow” goods.
“Say they have to go to a great party this weekend, so they buy a new dress. They wear it to the party on Saturday and return the dress to the store on Sunday,” LaRocca said.
This practice, called “wardrobing” or “closeting,” leaves the merchant with a dress that may be damaged, probably lacks its original tags and often can only be resold at a deep discount — if at all.
And this practice doesn’t only involve apparel, LaRocca said. “People do it with accessories, tools, computer games, holiday decorations — just about anything,” he said.
As a result, some retailers have made it more difficult for consumers to return goods, especially if they don’t have a sales slip or a gift receipt.
Casting a wide net
Return policies are extra tight for electronics, including expensive TVs and computers, which some merchants won’t take back if the plastic packaging has been removed. Or they may charge a “restocking fee” of 15 percent or more of the price.
James K. Willcox, associate editor of Consumer Reports magazine, which is published by the nonprofit consumer advocacy group Consumers Union in Yonkers, N.Y., said retailers are casting such a wide net in their effort to reduce fraud that they’re catching honest consumers, too. For example, he said, some retailers rely on computer programs to determine how many times a particular consumer has returned items in recent weeks.
“The way retailers are going about tracking returns, there’s no differentiation between fraudulent buyers and consumers who legitimately need to return things,” he said.
“It’s essentially a blacklist,” Willcox said. “It has a deterrent effect, because consumers who have been caught up in it hesitate to make even legitimate returns.”
He also pointed out that return policies vary greatly from company to company, and are sometimes different for Internet purchases and in-store purchases from the same company.
“I’ve been advising people to go to the company’s Web site and check the return policies before they buy,” Willcox said.
He said stores sometimes offer special deals for the holidays, “and you need to make sure the return policies applied to these (goods) too, that they’re not exempt.”
To ease the return of electronic goods, he suggests: Don’t take the protective wrapping off a device you don’t want. Make sure all the instruction manuals and peripheral items, such as a TV’s remote, are in the box before you return it. Take the item back to the store as quickly as possible because some retailers will provide a full refund only within 15 days of purchase or 15 days of the holiday.
Full disclosure sought
Edgar Dworsky, a former Massachusetts assistant attorney general who founded the ConsumerWorld.com educational Web site, said he’s concerned that many retailers do not post their return policies in places consumers can easily see them.
“There is no excuse for retailers’ continued failure to clearly disclose their return policies to shoppers in advance,” he said.
At the same time, he said, some retailers go out of their way to accommodate customers with extended holiday return deadlines and full refunds “because they know it’s good for their reputation.”
Dworsky's tips for hassle-free returns
- Hold on to a sales slip or gift receipt.
- Make sure the item is in new condition, unopened and with all original packaging materials.
- If the item is defective, some states mandate that the customer be give a choice of “the three Rs” — repair, replacement or refund.
- Consumers who have problems should complain to store managers or customer service departments. If they don’t get satisfaction, a complaint can be filed with the state attorney general’s office or the local consumer agency.