Writing a refund policy people trust

"Hi, can I return this?" arrives at 11:14pm, four days after a $38 mug shipped, and you have no idea what your own answer is. So you make one up. Next week someone asks the same thing and you make up a different one, and now you have two customers with two policies and no way to defend either.

A refund policy is not a legal document. It's a set of decisions you make once, in daylight, so that the answer at 11:14pm is a copy-paste. It has to answer five questions, in plain words, in about 150 words total. Everything else in this article is how to decide those five and where to put the result.

The five questions

Every refund policy that works answers these. Every one that causes arguments has skipped one.

1. How long has the buyer got? A number of days, counted from a moment you name. "14 days from delivery" is a policy. "A reasonable time" is a fight.
2. What condition does the item have to be in? Unused, unopened, seal intact, tags on, in the original box. Say it in the language a normal person uses.
3. Who pays return postage? You, them, or you-if-it's-our-fault. This is the question sellers hide from, and hiding from it costs more than answering it badly.
4. What do they get back? A full refund, a refund minus the delivery you already paid, store credit, or a replacement. Pick one as the default and say when the others apply.
5. What's excluded? Made to order, perishable, pierced jewellery, opened cosmetics, downloaded files, a service that's already happened.

Write your five answers on a piece of paper before you write a sentence of policy. The policy is just those five answers in order, with a friendly first line.

Decide it with arithmetic, not feelings

The generous policy and the strict policy both have a price, and you can work out yours in about ten minutes.

Take your average order. Say it's $38, your cost of goods is $11, and delivery to the buyer cost you $6. If a return comes back and you refund everything including delivery, you're out the $6 you already spent plus whatever you spend getting it back, and you get $11 of stock returned to the shelf. So the true cost of one return is roughly the delivery you can't recover, plus return postage if you're paying it, plus the packaging, plus the twenty minutes.

Now the other side. Count how many people ask "can I return it?" before they buy. If a clear, generous policy converts even a handful of those, it pays for several returns.

Policy	What it costs you per return	What it buys you
Free returns, you pay postage both ways	Outbound delivery, return postage, packaging, time	The highest conversion on anything people need to try on
Refund minus delivery, buyer posts it back	Packaging and time only	Most of the confidence, almost none of the cost
Store credit, 30 days	Almost nothing, you keep the money	Some of the confidence. Some buyers read it as a trap
Replacement only, faulty items	Cost of goods twice	Fine for low-value consumables, poor for clothing
No returns	Nothing visible. A quiet, permanent tax on conversion	Nothing

For most small sellers the second row is the right default, and it's the one almost nobody writes down. "Refund minus original delivery, you post it back, 14 days" is generous enough to close a sale and cheap enough to honour without resentment.

The law is not your policy, and it beats your policy

Many countries give online buyers cancellation and refund rights that a seller cannot write away. Some of them are stronger than anything you'd volunteer. Some don't apply to made-to-order goods, or to services already delivered, or to sales below a certain value.

I'm not going to give you a number of days, because it differs by country, by what you sell and by whether you're selling to a consumer or a business, and a confidently wrong number in your policy is worse than no policy at all. Look up the rules where your buyers live, before you publish a word of this. Search for your country plus "distance selling" or "consumer contracts" or "online returns" and read the government page, not a blog. If you sell into more than one country, the safest approach is to write one policy at the level of the strictest place you sell to.

Your written policy is the floor you're offering on top of that. It can be more generous than the law. It cannot be less.

A policy you can copy

Here's the whole thing. Change the numbers to your five answers.

Returns and refunds

If something's wrong with your order, message me within 48 hours of delivery with a photo and I'll fix it, either a replacement or a full refund including delivery. That's on me.

Changed your mind? You've got 14 days from delivery. Send it back unused and in its original packaging, and I'll refund the item price. Return postage is yours, original delivery isn't refunded.

I can't accept returns on earrings, on anything made to your measurements, or on digital files once they've been downloaded.

Refunds go back the same way you paid, within 3 working days of the item reaching me. Bank transfers go back to the account they came from.

Message me before you send anything back so I know it's coming.

That's 148 words. It answers all five questions, it distinguishes "you sent me a broken thing" from "I changed my mind" (which is the distinction that prevents 90% of refund arguments), and it says one thing most policies leave out: message me first.

That last line is worth more than the rest combined. An unannounced parcel arriving at your door with no note and no order number is a refund you'll process late, badly, and while irritated.

Two situations, not one

Most refund arguments are actually a category dispute. The buyer thinks they're in the "your fault" column and you think they're in the "changed your mind" column, and nobody has said so out loud.

So say it out loud, early:

Just so I understand which one this is: is the mug damaged or not what was described, or is it fine and just not right for you? Both are OK, I handle them slightly differently.

Nobody is offended by that question. It sorts the case in one message, and it tells the buyer that you have a process rather than a mood.

The "my fault" column should be fast, generous and almost free of conditions. A cracked mug, a missing item, a colour that isn't the colour in the photo. Refund it, replace it, don't ask for it back if it's cheap to replace and expensive to ship. Getting a $38 mug returned to Portland from Atlanta costs more than the mug.

The "changed your mind" column is where your conditions live, and where you're allowed to be firm.

What changes for food, custom work, files and hours

The five questions don't change. The answers do.

Food and anything perishable. No returns, obviously, but you still need a policy, because "no returns" is not an answer to "it arrived melted". Your policy is a replacement or refund policy for damage in transit, with a photo and a deadline of 24 hours. Say what you'll do about a summer delivery before summer.

Made to order. Say clearly, before payment, that a custom item can't be returned. Then protect yourself the other way: send a proof, a mock-up or a photo before you make it, and get a written yes. The yes is your policy. If you sell custom work without a proof step, you will eventually make a name plaque with a spelling the customer swears they never sent.

Digital files. A downloaded file can't be un-downloaded, and most sellers write "no refunds on digital products". Fine, but refund anyway when someone genuinely bought the wrong thing, because the file costs you nothing and the argument costs you an afternoon. Set a rule: refund on request within 7 days, no questions, one per customer. Track it. If someone does it twice, they're not a customer.

Services and bookings. This is a cancellation policy, not a refund policy, and it needs a clock. Free cancellation up to 48 hours before, 50% after that, nothing inside 12 hours. The numbers depend on how easily you can refill the slot.

Refunding on the rail you were paid on

The policy is the easy half. Sending the money back is where it gets awkward, and it's different on every rail.

• Card. Refund it in Stripe, and assume the processing fee you paid on the sale is not coming back. Check your own Stripe fee schedule before you promise free returns on a $12 item, because on small baskets the fee is a meaningful slice of the refund.
• Bank transfer. You send it back manually, to the account it arrived from. Never to a different account the buyer gives you afterwards, however reasonable the explanation. That request is the most common shape of a small-seller scam.
• Cash on delivery. You've got their cash and no rail to send it back on. Agree a method in the conversation, and get the account details from the buyer in writing in the same thread as the order.

The mechanics for the manual rails, including what to do when the buyer wants it somewhere else, are in refunding on a manual payment rail.

When to break your own policy

Constantly, and only in one direction.

A policy is a floor, not a ceiling. Refunding someone who's outside the 14 days, when they've been decent about it and it's a $20 item, costs you $20 and buys you a person who tells other people. Refusing them costs you $20 anyway once you count the review.

The rule that keeps this from becoming chaos: be generous privately, consistent publicly. You can quietly refund the person who's three days late. What you can't do is write "30 days" for one customer in public and "14 days" for another, because those two customers talk, and often in the same comment section.

Track exceptions for a month. If you're breaking your own policy more than about one time in ten, the policy is wrong and you should rewrite it to match what you actually do.

Worked example: Danielle, ceramics, Portland

Danielle throws mugs and small bowls in her garage in Portland and sells them through Instagram and a Sailo shop. A mug is $38, a set of four is $135, delivery inside the US is $9 and costs her about $6 in materials and postage. Around 35 orders a month.

Her first year, she had no policy. Roughly two people a month asked about returns and she answered each one differently. Then a set of four arrived with two mugs broken, the buyer posted a photo in her comments before messaging her, and Danielle spent a whole Saturday on it.

What she wrote afterwards is the policy above, near enough word for word. Two things she added that most people wouldn't think of:

She put "message me before you send anything back" in bold, because in her first year she got three unannounced return parcels and one of them sat in her post office for eleven days accruing storage.

And she stopped refunding the $9 delivery on change-of-mind returns, which she'd been doing out of guilt. Her return rate didn't move at all. Not one person mentioned it. That single line was costing her about $50 a month for nothing, which over a year is a kiln shelf.

The one that surprised her: breakage claims dropped by more than half after she wrote "photo within 48 hours" into the policy, and she doesn't think that's because people were lying. She thinks it's because a deadline makes people check the box on the day it arrives instead of leaving it in the hall for a week and discovering the crack later, by which point neither of you knows where it happened.

What Sailo does here, and what it doesn't

Not much, honestly. There's no returns flow, no RMA number, no label generation, no automatic refund window. An order in your admin can be marked refunded, and that's a label you set. It does not move money. On bank transfer and cash on delivery, nothing could, because Sailo never touches that money. On card, the refund happens in your own Stripe account, because that's where the charge landed.

So the policy lives wherever you write it, and honouring it is manual. What the shop gives you is somewhere to put the words in front of the buyer before they pay, which is the part that actually prevents the argument.

Card payments, for what it's worth, need a Stripe account cleared for charges, and Sailo takes 1–3% of the goods on each card order. If you're running 35 orders a month at $38 on bank transfer, none of that applies to you and you shouldn't upgrade to get a refund button you'd use twice a year.

Write your five answers now

Open a note on your phone and answer the five questions with numbers. How many days, what condition, who pays postage, what they get back, what's excluded. Then paste the policy above and swap your answers in. It takes fifteen minutes and you'll use it a hundred times.

Then put it where it's read, not where it's stored: in your shop's terms or product descriptions, in the message you send when an order comes in, and in a saved reply on whichever app your buyers message you on. Writing an order confirmation that carries the important half of it is covered in how to write an order confirmation, and if you want the longer version that sits underneath the policy, writing terms people will actually read is the next thing to do. The wider question of what makes a stranger hand you money in the first place is in building trust before money moves, and if the return is happening because of a card dispute rather than a request, read what to do about a chargeback first, because the order of operations there is completely different.