Return/Exchange Fee

What is Return/Exchange Fee?

Automatically deduct fees based on the return reason or refund resolution the merchant defines.

• Offset costs of return processing and shipping
• Discourage returns for certain reasons
• Automatically deducted from refund amount
• Configurable based on conditions you set
• Transparent to customers before submission
• Flexible fee structure (fixed or percentage)

Fee Calculation Methods

The refund fee can be set as either a fixed amount or a percentage, and it will be deducted for each refund request.

• Fixed Amount: Specific dollar/currency amount deducted (e.g., $5 fee)
• Percentage: Fee calculated as percentage of subtotal (e.g., 10% of subtotal)
• *If set as a percentage, the refund fee will be calculated based on the subtotal price
• Fee is applied automatically when conditions are met
• Customer sees fee before confirming return
• Final refund = Original refund amount - Fee

Video Tutorial

This is the video that instructs how to set up the return fee feature and how the return fee works in the portal.

Configuration Steps

Go to Settings > Return/Exchange flow > Fee and configure your fee settings:

1. 1Navigate to Settings > Policies
2. 2Scroll down to "Advanced Exchange Settings" section
3. 3Click "Edit" on "Variant exchange" or "Exchange with other products"
4. 4Toggle "Exchange Fee" to ON
5. 5Configure fee settings:
6. 6 • Fee Type: Select Percentage or Fixed Amount
7. 7 • Fee Percentage (%): Enter percentage value (e.g., 10)
8. 8 • Applied To: Select "Every Request" or "Every Order"
9. 9 • Applied On: Select "Item Value" or "Order Value"
10. 10Click "Save" to apply the fee configuration

Setting the Amount

Configure how much to charge for returns:

• Fixed Amount Example: Enter "5" for a $5 fee
• Percentage Example: Enter "10" for a 10% fee
• Select the type: Amount or Percentage from dropdown
• Consider your profit margins when setting amounts
• Can set different fees for different conditions

Writing the Description

This is the description of the return fee. Please customize clearly to help your customers understand how return fees work.

1. 1Write a clear explanation of why the fee exists
2. 2State the exact fee amount
3. 3Explain when the fee applies
4. 4Use simple, customer-friendly language
5. 5Example: "A $5 processing fee applies to all returns for changed mind"
6. 6Keep it concise but informative
7. 7Avoid technical jargon

Supported Conditions

Return and Exchange fee supports 2 conditions:

• Return Reason - Apply fees based on why customer is returning
• Refund Resolution - Apply fees based on refund method chosen

Condition 1: Return Reason

Charge fees based on the reason customers select for their return:

• Select specific return reasons that incur fees
• Examples of reasons to charge fees:
• • Changed mind / No longer needed
• • Bought by mistake
• • Found better price elsewhere
• Examples of reasons NOT to charge fees:
• • Defective / Quality issues
• • Wrong item received
• • Item damaged in shipping
• Can set different fees for different reasons
• Encourages customers to be thoughtful about purchases

Condition 2: Refund Resolution

Charge fees based on the refund method customer selects:

• Select which refund methods incur fees
• Options include:
• • Original payment method (cash refund)
• • Store credit
• • Gift card
• • Discount code
• • Bank transfer
• Example strategy: Charge fee for cash refunds, no fee for store credit
• Encourages customers to choose refund methods that benefit your business
• Can incentivize store credit by waiving fees

Combining Conditions

You can combine both conditions for more granular control:

1. 1Example 1: Fee applies when reason is "Changed mind" AND resolution is "Original payment method"
2. 2Example 2: Fee applies for "Changed mind" regardless of resolution
3. 3Example 3: Fee applies to any reason when choosing "Original payment method"
4. 4Create multiple fee rules for different combinations
5. 5More specific conditions give you better control

Automatic Fee Detection

If the return request maps with the conditions of return fee, this request will be deducted a fee.

1. 1Customer submits return request
2. 2System evaluates return reason selected
3. 3System checks refund resolution chosen
4. 4If conditions match fee rules, fee is applied
5. 5Fee amount is calculated automatically
6. 6Customer sees fee breakdown before confirming

Customer Portal Display

Customers see the return fee clearly displayed in the portal:

• Fee is shown before final submission
• Breakdown includes:
• • Original refund amount
• • Return fee amount (deducted)
• • Final refund amount
• Fee description you configured is displayed
• Customer must review fee before proceeding
• Transparency builds trust and reduces disputes

Fee Description in Portal

This is the description of the return fee. Please customize clearly to help your customers understand how return fees work.

1. 1Your custom description appears in the fee breakdown
2. 2Make it clear and concise
3. 3Explain the purpose of the fee
4. 4Example: "A $5 processing fee helps cover the cost of handling and restocking returned items"
5. 5Good descriptions reduce customer confusion
6. 6Reduces support inquiries about fees

Cost Recovery Strategy

Use fees to offset return processing costs:

• Calculate your actual return processing cost
• Include: Labor, shipping, restocking, inspection
• Set fees to partially or fully recover costs
• Don't charge fees for merchant errors (wrong item, defective)
• Balance cost recovery with customer satisfaction
• Communicate the purpose clearly to customers

Influencing Customer Behavior

Use fees strategically to encourage desired behaviors:

• Higher fees for "Changed mind" to discourage impulsive purchases
• No fees for quality issues to maintain customer trust
• Waive fees when choosing store credit instead of cash refund
• Fee-free exchanges to encourage exchanges over returns
• Graduated fees based on how soon customer returns
• Lower fees for loyal/VIP customers

Competitive Considerations

Balance fees with market expectations:

1. 1Research competitor return fee policies
2. 2Consider your market position (luxury vs budget)
3. 3Higher-end brands can justify higher fees
4. 4Communicate fees in return policy before purchase
5. 5Make return policy easily accessible
6. 6Consider offering "fee-free return period" promotions
7. 7Test different fee structures to find optimal balance

Be Transparent

Always communicate fees clearly:

• Display return fee policy prominently on website
• Include in return policy page
• Mention in product descriptions if applicable
• Show fee in portal before customer submits return
• Never surprise customers with unexpected fees
• Explain the reasoning behind fees

Apply Fees Fairly

Use fees judiciously to maintain customer relationships:

• Never charge fees for merchant errors
• Waive fees for defective or damaged items
• Consider waiving fees for first-time customers
• Provide exceptions for loyal customers
• Document your fee policy clearly
• Train support team on when to waive fees

Monitor Impact

Track how fees affect your business:

1. 1Measure return rate before and after implementing fees
2. 2Track customer satisfaction scores
3. 3Monitor support tickets about fees
4. 4Calculate revenue recovered from fees
5. 5Analyze which reasons/resolutions incur most fees
6. 6Adjust fee structure based on data
7. 7A/B test different fee amounts