Learn something new every day More Info... by email
The phrase caveat emptor translates to “Let the buyer beware,” and many people take this Latin phrase to heart when making purchases. One way to overcome the wariness of a consumer is to offer them a money back guarantee on purchases or services if they are not fully satisfied with how they’ve spent their money. People may be more likely to try something, especially something unknown, if they can get their money back if it doesn’t work out the way they hope.
A money back guarantee is essentially a promise by the seller or service provider to refund money paid if a good is returned or if a service is unsatisfactory. There are different levels of guarantees. Some promise money back based on customer satisfaction, while others guarantee they will return money if a product is somehow faulty or doesn’t behave in the way expect.
These guarantees are in contrast to things like exchanges. In some cases vendors might offer people free items if something isn’t satisfactory, or they may give them credit to purchase something else with that vendor. Alternately, some sellers allow direct exchanges only, where items must be exchanged for something else in stock or for the exact same thing if there is some defect in the original purchase.
There can be some limitations on a money back guarantee and one that still evokes the idea of caveat emptor is time limitations on returns. Some sellers may have very short periods of time which they will give a full refund. This could be a couple of weeks, a month, six months, a year, or longer depending upon the nature of the guarantee. A money back guarantee may also require specific documentation in order to be active. For instance, retail stores may not offer money back on items unless they still are in boxes, or retain their original tags, and they may need to be accompanied by a receipt that proves purchase.
One other thing that may be variable with money back guarantee offers is how the money is paid. With the frequent use of credit cards, some companies will only credit the card used to make the purchase. These companies argue that otherwise, the return really functions as a cash advance to the buyer. This can be problematic, however, if the person returning the item received it as a gift. Offers to only give store credit or to credit someone else’s card can mean a person can’t get money back and may have to go without the gift if they can’t find something else to replace it at that store.
Sadly, some disreputable vendors may try to hook buyers on products or services by offering a money back guarantee they have no intention of honoring. When this occurs, it is usually a fraudulent activity, and consumers would do well to report this to organizations like the Better Business Bureau. Through these reports, which become available to other shoppers, it may be possible to make consumers aware of fraudulent practices. However, for small items, it may be very difficult to ever successfully resolve a seller not honoring their guarantee. For those large and expensive purchases that involve considerable financial loss, it may be possible to sue the company that violated their guarantee.
One of our editors will review your suggestion and make changes if warranted. Note that depending on the number of suggestions we receive, this can take anywhere from a few hours to a few days. Thank you for helping to improve wiseGEEK!