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Find the Fine Print: "Free" Returns

Our business started from the simple desire to create a perfect t-shirt for ourselves. As we transitioned from fulfilling a personal need to thinking about making a business out of it, we try to hold true to that initial impulse: design a company around what we would like to see as a customer. This sounds obvious and straightforward, but let’s be clear – our company can only survive if it is profitable, so obviously there are compromises between “giving everything away for free” and having the profit-motive guide all decisions. One of the best examples of how we approach this dynamic is in how view the return/exchange policy. Instead of seeing it as a necessary expense that has to be managed, we look at it as a way to encourage folks, who are on the fence, to experience our Ts first-hand. On the surface, our approach to returns looks similar to those of other competing t-shirt companies… but just as we seek to disprove the “a t-shirt-is-just-a-t-shirt” argument, it’s clear that “free returns” are not always free...

From a strict business standpoint, there are two undeniable truths every retailer must grapple with: 1) a generous return policy is a non-negotiable expectation from customers and 2) returns are a major cost driver for retailers. That cost is even more significant for online retailers and especially high for online clothing retailers. In fact, clothing bought online typically has return rates of 30-40%1! So, while returns cannot be avoided, it makes obvious business sense to create policies that discourage and limit them to as much as possible. This is where the fine print comes in… “Free Returns & Exchanges” sounds great, but what if free isn’t free and you are restricted in actually experiencing the product before you can decide whether to return it?

Free… Sort of. The term ‘free’ would infer: I buy this, I return it, I am left with same amount of money I started with. Well, typically online clothing retailers will not refund any initial shipping charges on your purchase. Technically the return is free but you are still out of pocket on the initial shipping – which for men’s t-shirts can mean approx. 20% of your purchase price. A pretty strong deterrent – unless of course you spent enough initially to qualify for free shipping on the purchase (typically $1-$2 over the amount you would pay for two items… funny how that works).

Return It… But only if you haven’t actually tried it on. Here is the thing with cotton and other natural fabrics… they shrink after washing! Some items more than others – and that’s why we insist on our fabric being pre-washed before stitching – but how can you evaluate the fit of a T if you are not allowed to wash it or even wear it?! The problem of course for retailers is that a worn/washed t-shirt cannot be resold, so it is obviously in their best interest to limit their return policy to re-sellable condition. 

This loses sight of why a generous return policy is important for customers. No one wants to be stuck with something they don’t enjoy wearing. The ability to experience the product first-hand without risk of being out-of-pocket if it ends up not meeting your needs is understandably important. That is the driving principle for us and why we offer full refunds on returns (incl shipping) and accept returns on washed/worn t-shirts. Of course, we have to consider the financial risks and safeguard against abuse. So, for example our wash-it-wear-it return period is only 10 days vs 30 for unworn items and only applies to initial purchases. This protects us from being treated like a free rental program, while still allowing us to fulfill the primary purpose of our return policy: a risk-free first-hand experience of our Ts. Also, we are unable to refund shipping on international orders because the expense is simply too big. These are compromises that we would understand as customers, which is why we are ok with imposing them.

In fairness, we have some other things going for us that also enable us to be more generous in our return policies than some companies can be. We purposely avoid tactics that encourage impulse purchases (limited-time sales, e-mail marketing/spam) which naturally are going to have higher return rates. Maybe most importantly, however, we do our best to set expectations for our Ts upfront. In terms of distinguishing features, we highlight the narrower neckline and the T’s slightly shorter length. We recognize that some guys like their T-Shirts cut longer and prefer the traditional ribbed neckline – no problem, plenty of other options out there! The only differentiator we cannot demonstrate virtually is the quality of the 100% Peruvian Pima cotton our Ts are made of. Maybe above all other factors, it is our conviction in that regard that gives us the confidence to make it so easy to return our Ts. After all, unless we “tricked you” into buying a T-Shirt, our return rates should reflect the quality of our product. Happy to say so far, our return rates at under 5% have been exceeding our own expectations2… Funny how that works!

  

1 Source: https://www.cnbc.com/2019/01/10/growing-online-sales-means-more-returns-and-trash-for-landfills.html

2 Actual ‘If… Then Well’ YTD return rates as of Oct. 9th, 2020: 2.5%

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