LL Bean’s generous return policy will be a little less forgiving: the company, which has touted its 100% satisfaction guarantee for over a century, places a one-year limit on most returns to reduce abuse. and increasing fraud.
The outdoor specialty retailer said returns of items that have been destroyed or rendered useless, including some bought from thrift stores or picked up from trash cans, have doubled in the past five years, surpassing the annual revenue of the famous company boot.
“The numbers are staggering,” CEO Steve Smith told The Associated Press. “It’s not commercially sustainable. This is not reasonnable. And that’s not fair to our customers.
LL Bean announced on Friday that it will now accept returns for any reason for only one year with proof of purchase. It will continue to replace products for manufacturing defects beyond.
The company is also imposing a minimum of $ 50 for free shipping as part of a belt tightening that includes downsizing through early retirement incentives and changes to workers’ pension plans.
The Freeport-based company joins a list of other retailers whose return policies have been tightened. Outdoor retailer REI, which was once jokingly known as Rental Equipment Inc. and Return Everything Inc. due to its unlimited returns policy, imposed a one-year restriction five years ago. Other retailers have reduced the return window or imposed new conditions.
LL Bean’s announcement in a note to employees and in a letter to customers represents a sea change in policy for a 106-year-old company that has used its satisfaction guarantee as a way to differentiate itself from its competition.
Leon Leonwood Bean, the founder of the company, is credited with initiating the policy when 90 of his first 100 hunting shoes were returned. He gained goodwill by returning customers’ money, and he came back with a better boot. Thus was born the satisfaction guarantee.
But the trader never wanted his satisfaction guarantee to become a lifetime replacement policy, company executives said. The abuse of the generous no-time-limit return policy has accelerated thanks to people sharing their return stories on social media, they said.
The family business is braced for a backlash, but the changes honor the spirit of the founder’s original guarantee, said Shawn Gorman, LL’s great-grandson and company president. Internal surveys indicate that 85% of customers agree with the new return policy, he said.
“There is no one in this family who would have allowed this to happen if they thought LL would be mad at us, like he was turning in his grave,” Gorman said.
Over the past five years, the company has lost $ 250 million on returned items that are classified by the company as “destroying quality,” said LL Bean spokesperson Carolyn Beem.
“Destroy quality” items are intended for landfill. Premium products are returned to store shelves and “seconds” are sold at points of sale or donated to charity.
It’s not uncommon to hear stories of people cleaning basements of used or unwanted LL Bean products, sometimes decades after their purchase. Some customers replace the same items year after year to get the latest outdoor gear. Some even go to thrift stores, yard sales or dumps to collect LL Bean items which they then return.
Gorman knows it firsthand: He said that a shirt he gave to Goodwill, with his name printed on it, was once returned to a store.
Recently in the Returns Department, Dawn Segars told the story of a family who emptied their grandfather’s attic and returned a stack of 20-30 year old clothes. They ended up walking away with a $ 350 gift card.
Behind her, in the next room, an unpleasant smell wafted from a trash can containing returned items, including well-worn boots, torn bedding, dog cushions and other items.
Unlimited return policies are fraught with dangers, said Edgar Dworsky, consumer advocate and founder of ConsumerWorld.com.
“I consider a one-year limit to be very favorable to consumers. It’s not as good as unlimited, but it’s still good, ”he said. “Frankly, unlimited returns open the door to abuse. “
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