Costco return policy = free computer?

[photon]

Originally Posted by redforever

I dont think Costco policy allows fraud and unethical returns. I think they do however allow returns for defective merchandise, no questions asked. There is quite a difference.

Well not fraud (say returning an item you didn't buy), but what's an unethical return? They say returns for any reason, no questions asked.. Be it I don't like it or I changed my mind.

I'm not saying it's right to do, just looking at it from the other side.

[Ro]

I work at Costco. I have never worked behind the refund desk, but have a pretty thorough understanding of our return policy, and have heard a million stories about crazy returns.

Where to start. Bottom line is that our members pay $55-$100 for a membership, and keeping them happy is our #1 priority. Thus, if somebody comes to us with an item they'd like to return, only in rare circumstances are we going to say no (more on that below).

That is why we have no "official rules" regarding our return policy (aside from computers). I have worked at two different warehouses and visited countless others, and I assure you that from warehouse to warehouse and even within a certain building, every employee has a slightly different idea as to how exactly our return policy works and is applied. Everything from "6 months" to "forever" to "the length of the manufacturer's warranty" to "it depends."

We have gone directly to upper management at my current warehouse for clarification about this, and even they refuse to implement anything more specific than that. Like I said earlier, they are more concerned with keeping people happy and generating good "word of mouth" than having to eat the cost of an occasional patio set.

Without saying anything that could get me into real trouble, I'll put it like this: if we are told something is defective, doesn't work, doesn't work like they thought it would, isn't the proper size/make/color, or that the person already has one/received it as a gift, we're almost definitely going to process the return. If the member isn't specific, or simply says "I changed my mind" or "I don't like it," those returns are treated on a case by case basis, and our staff that is more skilled in "massaging the customer" might direct them to contact the manufacturer instead of OK-ing the return. But again, this varies immensely from day to day, employee to employee, and warehouse to warehouse. And it's always important to keep the member happy, so if somebody is super-pissed, they're a little more likely to get what they want.

What do we do with our returned merchandise? It depends. Some of it is sent back to the manufacturer/vendor for full or partial credit, some is destroyed, and some is put back on the shelf. In the case of most electronic stuff, it gets sent back to the maker and they fix it up, and in turn send it to a place like XS Cargo or Liquidation World where it is sold as "refurbished' merchandise.

What are some of the craziest returns we've had? Oh man, so many good stories. All of the following were returned for a full refund:

-Half eaten pies, cakes, deli items, pizzas, etc.
-At the end of every season, we get stuff back related to that season (ie/ backyard swimming pools, lawnmowers, snow blowers, patio sets, BBQ's, car shelters, patio swings)
-Big screen TV's come back ALL THE TIME, mostly because of technical problems. But they can claim whatever they want- we don't check into anything. If they tell us it's broken, we believe them. So, if a member paid $3000, in 1 1/2 years that same TV is now worth $1500 and they can upgrade to a newer, bigger plasma TV for that original cost, while claiming simply that the original TV no longer works properly.
-All sorts of gadgets and appliances (cameras, fridges, tools, and on and on and on)
-A branch from a tree that someone had purchased that had "died" in their front yard

Re: computers. The reason the 6 month policy was introduced was because we were getting screwed over pretty hard by people taking advantage of our return policy. Essentially upgrading every couple years. In theory, you could still do this every 4-5 months, but I think* they keep track of big returns like that and might start to deny you if you did it more than a couple times.

Like somebody mentioned, this has all changed in the States. In the US, there is now a 90 day return policy on ALL ITEMS, but after that problems are handled by the "Costco Concierge Service." It's essentially a program where we hold a member's hand through the process of contacting the manufacturer and fixing the problem, whether that means ordering a replacement part or sending the whole thing back or whatever. I believe Costco doubles whatever the warranty is on a certain item, but again, all that means is that after 90 days the member can call the concierge help # to assist them with the problem. i guess the company finally decided they'd grown tired of getting slammed from behind by dishonest members.

This 90-day concierge policy will eventually come to Canada, but there is no word on when that is going to happen. I don't know what will happen to items bought before that policy is implemented, but I would assume they would be grandfathered.

If anyone has any more questions, post them and I'll do my best to answer them.

[Ro]

Originally Posted by newts

You think that Costco takes the hit for any of the returns? Nope...returns just go to a reclamation centre and the supplier in turn usually gets short paid.

Not at all true. There are many things we don't get any credit from the manufacturers for, and plenty of things we only get 20-25% of the retail cost of the item back from the maker.

One thing we absolutely CANNOT do is re-sell or give away any of the things we find out we're not getting any credit for. An example would be a marble top patio set that came back a couple years ago- the table top was cracked and a few chairs were rusted. For whatever reason, the vendor told us they weren't going to accept it back or give us any return credit, so it went right in the garbage compactor. We could have easily got $500 for it, but instead we ate the cost.

I think vendors that have a more liberal return policy are more likely to strike an agreement with Costco to have their items sold in Costco warehouses, but that is pure speculation. What I do know is that there are dozens of items that are chucked out every day because we won't get any credit for them and aren't able to salvage/re-sell them.

[jayswin]

I work for a company that purchases and proccesses costco's returns, and I can tell you first hand that there are a LARGE number of people that abuse the system. The fact that RO pointed out that the US now has a stricter policy in place which will no doubtedly make it's way to Canada, is no surprise at all.

The new computer policy was a life saver for us. Before that we used to get computers that were so old that we couldn't even put them on the shelf for $100, yet the costco tag would say it was a $4000 computer, obviously this didn't add up.

[alltherage]

Originally Posted by DementedReality

Anyone work at Costco?

I was just there and they have these big signs that say with a reciept and original packaging you can return any notebook or desktop within 6 months for a full refund.

What is stopping someone from simply using it for 5 months and returning it and then doing it again for another 5 months and so on?

Does anyone find it a moral or ethical issue to do this?

Just curious, I thought it was a major loophole that could be abused.

In my opinion taking advantage of a situation in a way that ultimately harms someone else for your own gain is definitely immoral. Its just easier for some people to justify it with a larger corporation than it is to justify it with one person. The whole "drop in the bucket" ideology.

I do however think it is a great deal on the consumer end considering other corporations charge hundreds of dollars for extended warranties. The consumer loyalty Cosco gains from these kinds of guarantees probably outweighs the fiscal contrast of extended warranties. Cosco is definitely not a charity.

[jayswin]

[quote=alltherage;996661]In my opinion taking advantage of a situation in a way that ultimately harms someone else for your own gain is definitely immoral. quote]

In this case that 'person' is our company who pays for half year old computers like they are new on the market, then we have to turn around and just try and get cost out of them. Moral of the story, if you feel like something is immoral and someone might get screwed somewhere down the line, then your hunch is probably right.

[mykalberta]

Its been known for awhile that the 2 best return policies for scammers are 1 Costco and 2 Walmart.

MYK

[I-Hate-Hulse]

Originally Posted by Ro

Like somebody mentioned, this has all changed in the States. In the US, there is now a 90 day return policy on ALL ITEMS, but after that problems are handled by the "Costco Concierge Service." It's essentially a program where we hold a member's hand through the process of contacting the manufacturer and fixing the problem, whether that means ordering a replacement part or sending the whole thing back or whatever. I believe Costco doubles whatever the warranty is on a certain item, but again, all that means is that after 90 days the member can call the concierge help # to assist them with the problem. i guess the company finally decided they'd grown tired of getting slammed from behind by dishonest members.

This 90-day concierge policy will eventually come to Canada, but there is no word on when that is going to happen. I don't know what will happen to items bought before that policy is implemented, but I would assume they would be grandfathered.

Hmmm not a fan of this policy revision at all, and it would seriously change what I buy from Costco. I was angling to buy my new big screen HDTV from Costco next year for the warranty, even if I had to pay more than Future Shop. Change that to 90 days and I don't see the reason to buy that from Costco anymore. And pay $80 for a Membership.

I think they could address the scammers in other ways. A "resellable condition" and original packaging clause for starters. Exchange for credit would also work out well - at least the revenue's staying in the company. Bottom line, tighten the policy, don't abandon one of your cornerstones.

[MoneyGuy]

Originally Posted by DementedReality

actually, i do see an ethical issue with it, but I was asking what others felt.

my rule of thumb is genreally if you arent sure if its "ethical". it most likely isnt.

Sorry, man, it sounded like you were suggesting it. I also have a big ethical problem with it. And your rule of thumb is a good one.

Regarding returns, my bro-in-law used to work at a place where lots of returned merchandise was just chucked into the garbage. The stuff he used to bring home!!! He virtually furnished his house and clothed himself with returned merchandise. They used to sell it all at garage sales. He didn't make much money but his side "business" sure did well.