What Should I Include in My Exchange Policy in the UK?

When you run an ecommerce business, your website is critical to build and maintain. Not only is your website the place where customers reach your business and purchase products from it, but it is where you will likely publish information about your ecommerce store. Such information includes business policies like your website’s terms of use, refund policy and exchange policy. Exchange policies are legally binding and must also comply with certain requirements. This article will explain what you should include in your exchange policy.

What is an Exchange Policy?

Your exchange policy tells your customers the rules for exchanging a product they purchased from you. Your policy might allow a customer to exchange the product for:

• the same product in a different size (if you sell clothes);
• for any other item from your store;
• credit note to use in your store. 

If you allow your customers to return an item and receive the same amount back into their original bank account, this would count as a refund. You can record these details in a separate policy. 

Exchange policies are essential for all businesses, and a good one can make a difference in whether a customer purchases again through your online business. Clear exchange policies demonstrate that you honour your products and your customers’ choices. They also help establish trust between you and your online customers. It is, therefore, vital that you know what to include in your exchange policy for your ecommerce business.  

What to Include?

When you create your exchange policy for your online business, you may wonder what to include. In addition to ensuring you use simple language so customers understand the rules of your exchange policy, we also make some helpful suggestions below. 

Terms and Conditions for an Exchange

An important detail is outlining the terms and conditions for a customer to make an eligible exchange. Consider the following questions:

• How long does a customer have to exchange their product? 14 days? 30 days?
• How does a customer send the product back to you? Through the post? Who pays for shipping rates? If your business supplies a shipping label, will you deduct this amount from their credit? 
• What can the customer receive in exchange for their goods? Any product from your ecommerce store? Only the same product in a different size?
• Are any items ineligible for an exchange, such as swimwear or personal garments?
• What valid reasons can a customer have to exchange their product? Change of mind? Faulty product?

Setting out these details in plain, simple English is key to minimising customer disputes and promoting future purchases with your business. 

How to Manage a Business Dispute

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Process for Faulty Items

The most important part of your online exchange policy is ensuring it complies with the law. Your exchange policy must detail that you will exchange a faulty item within six months of return unless you can prove there was no fault with the item when the customer purchased it. It should also point out that:

• the person exchanging the item must be the one who bought it;
• if the customer requests the exchange after six months, they must prove that the item was faulty upon purchase;
• after an exchange of a defective item, the customer can still reject it before they formally accept it;
• a replacement for an exchanged item is accepted if the customer alters it; and
• a replacement for an exchanged item is also accepted if the customer has had ample time to inspect it and says they accept it. 

Display and Described

Your exchange policy must also say that you will exchange products that are not as you described them and if you are not legally entitled to sell them. This is a legal requirement. 

In addition to what to include in your exchange policy, you must consider where and how you display it. An exchange policy should be easy to find on your ecommerce website as this gives customers confidence in your business and an enjoyable experience with ease of navigation.

When drafting your exchange policy, you should also consider what not to include. One critical legal point is that including purposely misleading information is illegal. You may not display information that purposely misleads your customers or gives false information about their rights. This means that you should not write anywhere on your website, for example, that you do not accept returns or refunds. 

Be Realistic and Original 

Your exchange policy is a legal document and part of your sale contract, so it must be something you can honour. You must comply with your legal requirements as a business. 

Further, your exchange policy should not be a copy and paste of another business’ policy. While it is tempting to cut corners, the provisions of your policy must be suitable to your unique business. Otherwise, you risk not adequately protecting your ecommerce store.

Key Takeaways

A key policy you should display on your ecommerce website is an exchange policy. This may be a standalone policy or form part of your return and refund policy. An exchange policy is legally binding and must comply with the law. You should include terms and conditions for customers to make an eligible exchange, as well as what happens if a customer receives a faulty item. Further, an exchange policy should not contain anything purposely misleading, or that does not grant consumers their legal rights.  

If you need help drafting an exchange policy, our experienced ecommerce lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents for a low monthly fee. Call us today on 0808 196 8584 or visit our membership page.