You can write a strict no refund policy or provide more leniency by offering customers item exchanges or store credit. You could include a no refund policy, a type of return policy that explicitly informs customers that you do not provide refunds on items they purchase. You could write a basic return policy, or supplement it with one of the following: Time estimates for processing the returnīecause return policies are closely associated with shipping and handling questions, they often have a clause that links to a business’s shipping policy.How long customers have to submit a return.Fees customers pay when returning an item.What items are eligible for returns, and in what condition.If you accept returns, offer refunds, exchanges, or store credit.It sets your customers’ expectations about:
TARGET RETURN POLICY UPDATE
TARGET RETURN POLICY HOW TO
How To Outline and Prepare Your Return Policy.Common Questions to Answer in Your Return Policy.Return Policies Increase Customer Satisfaction.Return Policies Protect Your Business from Fraudulent Returns.Return Policies Set Proper Customer Expectations.In this guide, we’ll discuss what a return policy is and why they’re so important, then teach you how to write a return policy that’s concise, effective, and helps you retain more customers. So, to achieve the required rate of return, the company should sell the pencil at Rs 20 each.Writing a clear, straightforward return policy gives your customers a good experience when returning something, leaving them with a satisfied opinion of your store. Here, we are assuming that sales can hit 50,000 units in a year. The company manufactures pencils and have already invested Rs 10,00,000 in the business. A company ABC Ltd has an objective of achieving a required rate of return of say 20% on goods that they sell. Let’s understand the concept of rate of return pricing with the help of an example.
It does not take into the account the price elasticity and the pricing of the competition which are two important things to consider before the final pricing is set. Pricing the product by rate of return can also have some short comings. The target return price can be defined as: Target return price = unit cost + (desired return * invested capital) / unit sales The process becomes easy if there is little competition, as compared to a situation when there is competition. The price is set in such a way that the ultimate goal of achieving corporate profit objective is met if sales continue to run at a given rate. The rate of return pricing helps the company in achieving a certain level of profit which is required to keep the liquidity intact. The only difference is that in this approach, manufacturer or the company can manipulate or change the price of the product to achieve the ultimate goal of the organisation. This is a common practice, but can only be effective in cases or products which have very little competition.ĭescription: The concept of rate of return pricing is similar to return on investment. Definition: Rate of return pricing is a method by which a company fixes the price of the product in such a way that it ultimately helps organisations in achieving the ultimate goal or return on the capital employed.
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