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by zamadatix 858 days ago
Beyond the individual return you have to look at how many additional sales this generates (e.g. from the "gee it's nice but I'm not sure I want to bet $5,000 I'll like it 10 days from now" folks) vs the retention rate of these additional sales (e.g. "Well x% do decide to return it because they didn't like it) in combination with your per sale margin and restock costs. I.e. if you just look at the individual return it seems stupid, if you look at the overall sales picture it's often a way to generate more profit.

Or, another way to put it, if it's so certainly causing a loss other customers have to bear why would the company promote the return policy and lose out on that margin from paying customers?