Costco Ends Lifetime Return Policy

Costco ends lifetime return policyIt really doesn’t come as a surprise to me that Costco has ended their lifetime return policy because there were a lot of people abusing the system. I heard through a friend about one person who bought the largest high definition big screen TV Costco had simply to throw a Superbowl party with his friends this year. He returned it the next week. While that kind of abuse is still possible under the new Costco return policy, the updated rules help solve a costly abuse problem that was becoming rampant and costing the company quite a bit of money.

Electronics tend to fall in price rapidly when new generations appear and the life-cycle of each generation is fairly quick. What people started to do was purchase the latest generation electronics, then return it in six months to a year, get a full refund and then purchase the next generation gadget that was usually more powerful and cost less money – leaving Costco with an outdated product it could no longer sell.

The new return policy (pdf) for electronics is 90 days, but still remains much more liberal that many other stores’ return policies.

It’s a shame that they had to change the policy. They are a great example of a company that treats their employees and customer’s right, but get rewarded by having customers abuse the system. The sad fact is that if people continue to abuse the system, it will hurt all of us with tighter return rules. Quite unfortunate…

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4 Responses to Costco Ends Lifetime Return Policy

  1. BoilerHorn says:

    Costco’s liberal return policy was one of the main reasons I used when purchasing electronics items. I think this change might be a bit more drastic than required.

    Here is a personal example: I bought a 20″ TV-VCR-DVD player in 2003 for $399. Approximately 13 months later, the DVD portion failed. After I inquired, Customer Service recommended I return it. I would have been thrilled to receive a replacement, even if refurbished. Costco refunded my money ($399) and I promptly purchasaed a newer model for $299. My intention was to have the issue resolved under Costco’s policy. It seems that they did not police their policy well.

    Of course, this new policy does not protect Costco against the consumer that borrows a TV for the Super Bowl. I would not be surprised if Costco decided to create a new 5-year extended warranty plan on electronics that, for a fee, will allow a consumer to have the same ‘lifetime’ treatment over the first five years of a product’s life.

    I think Sam’s Club has a similarly liberal return policy. In fact, it was advertised to me when I was shopping for flat panel TVs a year ago.

  2. shraz says:

    Do they have any warranties? The best thing is free 1 year warranty and pay for more than 1 year like most of the stores.

  3. johnnyj says:

    But Costco’s membership fees are there partly because of their return policy. Sure people will abuse it, or use it more than others. It’s not unlike any insurance policy. We all have to pay a high premium to cover the costs of all members, even those who are chronically ill. If Costco does indeed lower the policy to only 90 days, then they really ought to reduce the membership fees. It’s only fair.

  4. ruben says:

    Costco need to publish this info!!!

    Dear Ruben,

    Thank you for your e-mail to Costco Wholesale. All orders or items over two years old is up to the discretion of the warehouse or online Returns department. Since these orders are past the 2 year time frame they would be denied.

    Thank you,

    Costco Wholesale Corporation

    Date: 12-29-2010
    RE: Non specified return policy time limits?

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