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Costco to make return policy stricter?

Old 12-10-06, 01:06 PM
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Costco to make return policy stricter?

http://www.consumerist.com/consumer/...ter-220616.php
Old 12-10-06, 01:07 PM
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The "article" (no source, no real information other than rumor):
Costco is making its liberal return policies stricter, according to a little birdy. Previously, you could return anything, except computers, at anytime, with or without a receipt.

Our tipster says Costco will limit returns to 30 days, citing 'abuse.' We called Costco and they had no idea what we were talking about, but if they were changing their policy, said Barbara, it wouldn't be until after Jan 1.

Barbara also said that if they were changing the policy, it would be to restrict certain items, like computers, which currently have a 6-month limit on their return.

If you have any Costco merch lying around the house that you're not feeling so hot about, Dec 31 might be the last day for you to return it. That is, if they were changing their return policy. — BEN POPKEN
Old 12-10-06, 06:43 PM
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there was a fatwallet thread about it and supposedly someone who said they work for costco said it was going to take place starting in 2007

if they do change it, all i can say is that it's about time
Old 12-10-06, 07:12 PM
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I wonder if this affects purchases made after the new policy goes into place or if it would affect prior purchases as well.
Old 12-11-06, 06:01 AM
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I doubt they will change this, they may do it for specific items though like TVs.
If so it would probably be the length of mfr warranty, not 30 days.
Old 12-11-06, 09:24 AM
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Can't argue with this change at all. Way, way too many people were abusing it.
Old 01-03-07, 01:05 AM
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This is news to me and I work at Costco doing returns
Old 01-03-07, 01:15 AM
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I just returned a Sony LCD last night that I had bought last February without any problem whatsoever(the TV had an annoying clicking sound that was getting worse).
Old 01-03-07, 01:26 PM
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Good to know. Costco probably just wanted to 'test the waters'
Old 01-15-07, 10:08 PM
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About time... You have to be kidding me... Costco was built on the concept of being able to return anything, except when law restricts certain returns. I should know. I used to work for them...
Old 01-15-07, 10:27 PM
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Originally Posted by PJsig08
Good to know. Costco probably just wanted to 'test the waters'
Huge thread on Fatwallet about this. It has been debunked. What may happen is that Costco attempts to resolve issues via servicing prior to returns, but it will not be mandatory.
Old 01-18-07, 10:39 AM
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I just read over at www.hot-deals.org that Costco has changed their return policy on electronics. You now get 3 months to return an electronic item "no questions asked" and 6 months if the item is defective. Now would be a good time to return any of those old TVs that you may have laying around.
Old 01-18-07, 07:34 PM
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They are wrong, Costco's return policy has not changed.
Old 01-18-07, 08:52 PM
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Here's an update from hotdealsclub.com:

"Costco Electronics Return Policy NOT Changing: In response to our recent article about Costco's return policy on Electronics changing, we were contacted by a member at Costco Corporate who told us this was a rumor and is untrue. Costco Corporate is aware store managers circulated documents detailing a change in the Costco return policy, and are relaying this false information to their employees and customers. Their return policy continues be an unlimited return policy on all electronics purchases, including HDTVs, GPSs, stereos, projectors, cameras, MP3 players, and phones. While they have no limit on how long they will accept returns with the original receipt, some stores may give difficulty with electronics returns greater than 3 years old."
Old 01-19-07, 09:54 AM
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thats good I was planing on getting my hdtv from there sometime this year. glad to see its not changing
Old 02-28-07, 05:55 PM
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Only 90 days return policy for electronics now.

http://www.msnbc.msn.com/id/17350641/

Costco tightens return policy on electronics
Company faced concerns that lenient practices were hurting bottom line

MSNBC staff and news service reports
Updated: 3:36 p.m. PT Feb 26, 2007

Costco Wholesale Corp. is tightening its policy on how long people can take to return electronics items, following concerns that the retailer's traditional lenience was hurting its bottom line.

Costco has until now allowed customers to return items at any time for a full refund, except for personal computers, where returns were limited to six months. But there have been concerns that the policy was proving problematic for some high-end electronics such as high-definition televisions.

Some people took televisions home and then returned them when they were disappointed because the picture didn’t look as good as it did in the store. A bigger problem for the company, however, was that some people appeared to be taking advantage of big price drops by returning an older item and then snapping up a newer, less expensive — and, in some cases, fancier — model.

"It's created an issue for returns," said Chief Financial Officer Richard Galanti.

Financial analysts, who have raised concerns about the financial repercussions of Costco's permissive policy, appeared relieved by the change.

“Provided the margin and earnings per share drag caused by the lenient policy, the change is a positive development for the stock and will begin to cap margin dilution going forward,” said JP Morgan Securities Inc. analyst Charles Grom in a research note.

The new policy, which the company quietly noted on its Web site, will give customers only 90 days to return televisions, computers, cameras, camcorders, portable music players and cell phones.

Those products represented about 5 percent — or roughly $3 billion — of Costco's $59 billion in sales from its fiscal year ended Sept. 3.

The Issaquah, Wash.-based retailer introduced the revamped policy Monday in its 109 California warehouse stores and plans to debut the changes in the rest of its 371 U.S. locations within the next five weeks, Galanti said.

To help soften the blow, Costco plans to extend the warranties on televisions and PCs for a total of two years. The company also plans to roll out a technical support line to help customers who may be returning items such as iPods because they are frustrated that they can't get them to work correctly, Galanti said.

"We think it's still the best policy out there, by a long shot," Galanti said.

Costco customers pay between $50 and $100 per year in membership fees to shop for discounted items ranging from suit jackets to dishwasher detergent.
Old 03-01-07, 12:28 AM
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I'd be curious if this is a retroactive change or if it only applies to newly purchased items. Can you legally change the return policy for something after it has been bought? That sounds kind of scary.
Old 03-01-07, 12:47 AM
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Originally Posted by Peep
I'd be curious if this is a retroactive change or if it only applies to newly purchased items. Can you legally change the return policy for something after it has been bought? That sounds kind of scary.
I wouldn't expect so. It would be like changing the warranty on your car after you've bought it.

I had a store try to do this to me once. I bought a pair of jeans and the sales clerk went out of her way to tell me that their stores policy allowed you to return items for a refund for any reason at any time. I didn't wear the jeans for about 6 months, and then, after wearing them about 4 or 5 times, the belt line went all weird. When I returned them, another clerk told me they had a new policy and there was a 30 day limit. I said that I didn't care what their policy was now, just what it was when I made my purchase. I won the battle (after talking to the regional sales rep), and then never shopped there again.
Old 03-01-07, 08:12 AM
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Originally Posted by Peep
I'd be curious if this is a retroactive change or if it only applies to newly purchased items. Can you legally change the return policy for something after it has been bought? That sounds kind of scary.
Items purchased prior will be grandfathered.

Can they change the policy? Yes, either with notice or a disclaimer (e.g., policy subject to change).
Old 03-01-07, 11:22 AM
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Originally Posted by DVD Josh
Items purchased prior will be grandfathered.
Is this something that you know for sure? I'm curious where you heard it. I'm totally fine with them changing their policy for future purchases - especially since it was such a crazy policy.

I consider myself very stingy when sprending money but will always buy electronics from Costco (if they have it in stock), even if I can get it for 10-20% cheaper elsewhere. This is totally due to their return policy (which I have yet to exercise on an electronic item purchase). I consider it the best insurance anywhere. Much better than an extended warranty.

Anyway, I'm sure the lost business from people like me will be more than made up by the stoppage of the rampant abuse that a policy like this must generate.
Old 03-01-07, 12:14 PM
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Why would someone not continue to buy at Costco? Higher prices? Won't this new policy help lower prices?

Is the indefinite return period worth so much in money that people buy electronics at Costco at a higher price, fully intending not to return the item but want a "forever" return ability? Or is it that they think there's a high likelihood of their returning the item many months later? Should a seller be liable for a product working or satisfying a customer forever?

I don't see why this new policy would stop people from buying there unless they intend to abuse Costco's liberal return policies. Where else can you return a 90-day old used electronic item? If it isn't DOA within 90 days and doubling the warranty isn't good enough for some of Costco's customers they probably are better off without them.
Old 03-01-07, 12:36 PM
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Originally Posted by X
Why would someone not continue to buy at Costco? Higher prices? Won't this new policy help lower prices?

Is the indefinite return period worth so much in money that people buy electronics at Costco at a higher price, fully intending not to return the item but want a "forever" return ability? Or is it that they think there's a high likelihood of their returning the item many months later? Should a seller be liable for a product working or satisfying a customer forever?

I don't see why this new policy would stop people from buying there unless they intend to abuse Costco's liberal return policies. Where else can you return a 90-day old used electronic item? If it isn't DOA within 90 days and doubling the warranty isn't good enough for some of Costco's customers they probably are better off without them.
Agreed to some extent, but I will still probably buy fewer electronic items there.

Example, I bought my Xbox 360 there. I did not save money by buying it there, it was cheaper elsewhere. However, I factored into my decision the fact that I would not need to buy the Microsoft 3 year warranty. I fully intend to return my 360 to Costco if it breaks within 3 years. You may consider that abuse, but I do not.

Now, buying an item there with the foreknowledge that you will definitely return it a year later to get a better price/features? Yep, I see that as abuse. But if you are only planning on returning it if it breaks, then I see no problem with returning it years later.
Old 03-01-07, 12:39 PM
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I just want to know how Costco intends to 'double the warranty' on computers & TV's. How are they going to accomplish this? Are they going to perform any work after the original manufacturer warranty expires? Are they going to pay to have that work performed by a factory authorized service center?
I don't see it as people getting upset they can no longer "abuse" the policy, it's just that it's gone. It's that piece of mind knowing that if something does go wrong, you won't have to worry about it, just return it and get a new one. Yes, the policy was crazy in that you could return a broken from normal wear-and-tear 10 year old microwave and get back the $300 you originally paid, then buy a far better one for about half the price. However, the customer never forced Costco to implement the policy, but I'm sure it influenced the customers decision to purchase from them. Another problem is lifetime guarantee -> 90 days will probably not be seen as an adequate compromise by most. Who knows if this will affect customers decisions to purchase and subsequent prices any.
Old 03-01-07, 12:47 PM
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Originally Posted by Trevor
Example, I bought my Xbox 360 there. I did not save money by buying it there, it was cheaper elsewhere. However, I factored into my decision the fact that I would not need to buy the Microsoft 3 year warranty. I fully intend to return my 360 to Costco if it breaks within 3 years. You may consider that abuse, but I do not.
I just don't see that a store should have that liability, and I certainly don't see how they can do it while having the lowest prices. Especially when an item just being old can be equivalent to breaking to a number of abusers of their policies.

Since Costco operates at high volume and low margins I would hope they would be able to have the lowest price in the future and people who want to have peace of mind can buy their own warranty. Perhaps Costco will be able to offer warranties at lower prices as well.
Old 03-01-07, 12:55 PM
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Originally Posted by Trevor
Now, buying an item there with the foreknowledge that you will definitely return it a year later to get a better price/features? Yep, I see that as abuse. But if you are only planning on returning it if it breaks, then I see no problem with returning it years later.
I agree. I'm not sure what the confusion is. Many honest people pay extra money for an extended warrenty. This is much better!! If something breaks, you don't need to wait for it to get fixed, you take it back for a full refund! And it covers normal wear-and-tear, which many warrenties don't cover. You even get the premium that you paid for the right to return it refunded.

As I said before, it does invite misuse, and it's probably a big money-loser. They took it away from PC-purchases sometime in the past, most likely because of abuse.

Why would I stop buying electronics there? Because going there is a pain and I can usually find electronics cheaper elsewhere. Duh.

Originally Posted by X
Where else can you return a 90-day old used electronic item? If it isn't DOA within 90 days and doubling the warranty isn't good enough for some of Costco's customers they probably are better off without them.
I'm not sure why you think that makes me a customer worth Costco losing, but I'm sure that Costco is willing to lose some good customers in order to prevent the misuse of this policy by others. My membership came due at the end of last month and I am seriously reconsidering renewing it. I don't buy that much at Costco to offset the hassle of going there (now that they seem to have drastically scaled back their DVD deals) and their "extended" electronics warrenties was one of the few things worth sticking around for.

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