To protect your business, ensure supplier contracts meet your business\u2019 needs. Our free Commercial Contracts Checklist will help.<\/p>\n <\/div>\n \n\nDownload Now<\/a> <\/section>\n <\/div>\n\n\n\n\n If your business sells products or goods to customers, it is your responsibility to know when to give them a remedy if something goes wrong with them. For continuity and transparency, setting this out in a returns or refund policy<\/a> can be helpful.<\/p>\n\n\n\n If you sell products to consumers for personal or domestic use, the law outlines certain situations in which you must give a customer a remedy. Under the Consumer Guarantees Act<\/em><\/a>, you must offer a consumer a remedy when the product is not:<\/p>\n\n\n\n If you fail to meet these consumer guarantees, you must give a customer a remedy in the form of a:<\/p>\n\n\n\n In your refund policy, be clear with your customers about these instances and when they apply. You could face significant legal penalties if you mislead customers about their consumer rights to these guarantees.<\/p>\n\n\n\n It is a good idea to ask customers to bring proof of purchase, such as a receipt or bank statement.<\/p>\n<\/div>\n\n\n\n You usually do not have to give a customer a refund or other remedy outside these situations. For example, if a customer changes their mind or orders the wrong size t-shirt, you do not have to give them a remedy. Alternatively, you may provide a remedy (such as a replacement) within a set time period following purchase.<\/p>\n\n\n\n In line with your consumer law obligations, you need to give a customer a remedy<\/a> if you sell them a faulty product. Whether a product is faulty will depend on the following factors.<\/p>\n\n\n\nRefunds at Your Business<\/h2>\n\n\n\n
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Dealing With Faulty Products<\/h2>\n\n\n\n
How impactful is the fault?<\/strong><\/td> Would the consumer have purchased the product if they knew of the fault? Does the fault impact the use and enjoyment of the product? <\/td><\/tr> Type of products<\/strong><\/td> How old is the product? Did you sell it second-hand? Second-hand products will likely have already been used, and some wear and tear will make them less durable. Some products are intended to last for an extended period of time, whereas others are more disposable in nature. <\/td><\/tr> Price<\/strong><\/td> Higher-quality goods tend to be more expensive, and consumers will expect more durability from more expensive goods.<\/td><\/tr> Statements you make<\/strong><\/td> If you make promises or guarantees about product quality, you have to back up those promises.
Depending on these factors and the context of the sale, goods will be faulty if they are not of acceptable quality. This can vary, but it generally means that your products are:
+ fit for their intended purpose;
+ safe;
+ durable;
+ free from small defects; and
+ satisfactory in overall appearance and finish.
If a customer comes to you complaining of a minor fault in your product that is easily fixable, you can choose the remedy you give, such as repairing the product. However, if the product has a major problem, such as being unsafe, the customer can choose what kind of remedy they get.
In keeping with your consumer law obligations, you should be able to repair the products you sell. You can do this by having:
+ the necessary experience to do so yourself; or
+ a repair contract with the manufacturer or other trusted repairer.
If you do not have repair facilities, you must let the customer know before completing the sale.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n\n\n Continue reading this article below the form\n <\/i>\n<\/a>\n
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