Sanity is dawning on the ecommerce sector was the reaction of most sellers on Flipkart’s latest move to cut short its product-return window. The move to slash the 30-day window of returning goods bought on Flipkart to 10 days for three categories -- mobile phones, electronics and jewellery -- is being met with a lot of enthusiasm from sellers and sector observers.
Most feel that there was a tendency for a 30-day window to be abused by buyers. With other e-commerce players too following this policy, Flipkart has rationalised it by its latest announcement on product-returns. If a seller is confident about the quality of the product, then 10 days is more than enough for a consumer to make up his mind, said a few sellers.
In February, Amazon first stopped its return policy on mobile phones and stated that all "Mobile phones that are fulfilled by Amazon, purchased on or after 7 February 2016 will have a replacement-only policy. Mobile phone items that are fulfilled by Amazon will no longer be eligible for refunds. In case you have received a defective or a damaged mobile phone, you will be eligible for a free replacement.”
Amazon then updated its goods return policy to include tablets, laptops, desktops, monitors, cameras and camera lenses purchased after May 11 to be ineligible for refunds and could only be given a free replacement.
It is clearly a cost-cutting exercise and a prudent fiscal measure, says Paula Mariwala, Executive Director, Seedfund, with regard to Flipkart's latest move. “Flipkart is trying to streamline processes and inventory costs and this window helps the e-commerce player to exercise greater control on collections and transactions,” says Mariwala.
Flipkart’s move is a well-thought move for profitability and to reduce costs, says Harish HV, Partner, Corporate Finance, Grant Thornton in India. “Any return is expensive and picking up costs money. The 30-day window can be misused and 10 days is decent enough to return a product. I am sure many other e-commerce players will follow suit,” he said.
Relief for sellers
Ronnie Kuriakose of Penguin Random House India says that with regard to the shorter window on books, it is a good policy as it ensures that the books are not damaged. “In theory, it might look as if it's to ensure that people don't get a book, read it and then return it and get another. But I wonder who takes the trouble to do that?”
Flipkart’s change of return policy is a 'good move', concurs Puneet Chawla, co-founder and CEO, Jaypore, an online portal that sells clothing, jewellery, accessories, home decor and gifts. The company had earlier sold for a short while some of its products on Flipkart.
From the company's experience, co-founder and CEO Puneet Chawla says mostly by the time consumers return the product after 30 days, there will be no demand for it. Jaypore now has a 5-day return window for jewellery and 10 days for all other goods. “I feel that a 10-day return window is more rational in a country like India where it has become a norm to abuse the return policy. It is a good thought out move on Flipkart’s part,” he says.
Gadget360, that sells tech products online, has had a seven-day return product policy from the start. The company says that seven days is more than enough for a consumer to decide on whether he wants the electronic product or not.
“Electronic items have no value once the seal is broken,” says Bhawna Agrawal, CEO, Gadgets 360. Consumers may misuse products in the fashion category and package it and resend it without the buyer knowing it is a used product," Agrawal points out. However, this does not work in the category of electronics products. Products sold on Gadgets360 can be returned only if there is any technical issue with the products – such as glitches with hardware or software, any part missing or also if the product is not opened.
With Fiipkart and Amazon having reduced the product return window, the reverse exchange calls regarding the product return have also come down. Most sellers said that that the return product policy should be changed to 10 days or shorter for all products that are sold online.
“As a user if I buy something, why do I need 30 days to change my mind,” ask most sellers on e-commerce marketplaces, stating that offline there is no such policy and no offline seller would come home or offices of the consumers to take the product back. The company is absorbing the shipping charges and the reverse logistics as well, they point out.