Retail Observer

RETAILOBSERVER.COM MAY 2016 52 A t a time when retailers are working harder than ever to realize favorable balance sheets, they also realize that this goal can be challenged daily by the ever-present problems associated with customer returns. In fact, a recent report from Optoro, a reverse logistics provider, estimated that consumers returned a whopping $248 billion worth of merchandise last year. Additionally, other industry experts say that lax return policies on the part of many retailers are likely to cause that number to escalate in the months and years ahead. Cognizant of the challenge that mattress returns present--and with an ongoing mission to help educate its members-- BrandSource recently invited a group of key retailers to discuss the issue of mattress returns and to share best practices that can be utilized by other members hoping to minimize the impact that returns have on the bottom line. Joining the discussion were Tom Balisteri of Colders based in Milwaukie, WI; Eric Bowe, senior mattress buyer at Denver, CO-based Appliance Factory & Mattress Kingdom; Nick Sarles, Mattress Sales Director of Amherst, NY-based Orville's Home Appliances; Gerry Curtis, owner of SleepSource, based in Phoenix, AZ; Eric Cenatiempo, General Manager of Appliance & Furniture Mart, Garden City, KS.; Jeff Willis of Famous Tate, headquartered in Tampa, FL; Steve Illingworth, Vice President and General Manager of Bakersfield, CA-based Urners and Ira Fruitman, owner of San Francisco, CA-based Bedroom Express. RETURN POLICIES VARY SIGNIFICANTLY The first observation that came to light was the realization that return policies among the group were as individual as each of their businesses. For example, Tom Balisteri of Colders, told the group, "Our return policy is simple–we don't take returns other than comfort returns." Meanwhile, Eric Cenatiempo at Appliance Furniture Mart, said his store allows for a seven-day comfort guarantee during which time the consumer can select another mattress. "However, that is an exchange, and not a refund," he stressed. Orvilles Nick Sarles offers a 101-night sleep guarantee, but said they put that policy in place to combat a similar offer that is offered by a large regional chain. He also confirmed that the tie–in between having to buy a mattress protector and being able to utilize the comfort guarantee has resulted in an attachment rate for mattress protectors of just under 70 %. Jeff Willis of Famous Tate shared that his store offer a 60-night comfort guarantee, but in order for the customer to utilize that, he or she also has to buy a mattress protector along with the mattress. Willis also shared that his customers are also required to sign off on a mattress checklist, a move that he says has helped the chain drastically reduce returns. Gerry Curtis of SleepSource offers a comfort exchange of three days—or whatever the specific manufacturer offers. He does routinely ask customers to sleep on the new mattress for a period of three weeks to allow them to get used to the new sleeping surface. "Once they do that, we hardly ever hear back that they want to return the mattress," he explained. Meanwhile, Steve Illingsworth at Urners reported his store offers a return policy of 100 days and will issue a full credit. And while the majority of the group confirmed that they typically do not charge a restocking fee, most do charge customers an exchange and or redelivery fee ranging from $75 to $150. MORE INFORMATION MEANS LESS RETURNS As the group drilled down into the issue of returns it became clear that the higher the incidence of information from the retailer regarding customer expectations, the lower the rate of returns. Willis, for example, has a two-page mattress checklist that his associates explain to each customer. Bowe at the Appliance Factory has a form that customers must sign. He said that while that policy was in place it was not always being executed by the sales force. Now, it is a requirement that the salesperson must adhere to. "We have to have that done because if there is an issue and we have no paperwork showing what the customer signed off on, we have to side with the customer." Willis agreed, saying having signed paperwork from the customer has alleviated many of the errors that could result in returns. E. Michael Allen, BrandSource VP of home furnishings, has been with the organization for 15 years and overseen the growth of the category to one of the largest in the country. Mike Allen Furniture Trends RO BEST PRACTICES: MATTRESS RETURNS Key retailers reveal how to minimize returns and maximize customer satisfaction

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