Refund policies – why you want one!
First, let me apologize for the late post… I thought I had a post scheduled for today but missed it. I’ll try not to do that again… but no guarantees – life happens!
For new hosts, this is probably not on your list of high priority items, but it should be! Every host, or every business for that matter, should have a stated refund policy. Plus that policy should be publicly available. The reason being is it makes the issue when (and it is when not if) a refund request comes up, you can simply refer back to the policy for how to handle it. You should put some thought into it now, and not have to think about it when it finally does happen. And actually as a newer host, it is more likely to happen sooner than later.
Of course there will always be exceptions, and you should account for that in the policy itself… for “unusual circumstances”. It should not be your way of getting out of giving a refund without cause. But if you say that there’s a 30 day money back guarantee, you should honor it. But personally if the user knowingly abused the service, and your Terms of Service permits it, a refund is not warranted. But notice the TOS reference… your stated refund policy should reference accounts terminated for TOS violations and how they will be “normally” handled – if there is such a thing as a “normal TOS violation”. Ideally it should be a part of the TOS itself. So that customers explicitly agree to it on sign up… You are having them agree by checkbox, or other method right?
Having a stated refund policy helps build trust in your new hosting company. It shows the customer that you are thinking things through… That you are flying by the seat of your pants… You have a plan, and are working it.
One of the other benefits is when a customer leaves, voluntarily or not, when they want a refund and start the threats, etc. You can refer to your refund policy. If you don’t have one, you’re at somewhat of a disadvantage should it go any further than the threats. Payment providers will want to know the terms that the customer agreed to, and if it’s not spelled out, it may mean that you will lose any challenge.
So go ahead and start working on your refund policy if you don’t have one already. Or review the one you have… You want this in place sooner rather than later.
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Robert Porter holds Oracle Certified Professional-Java 6, MCSE, A+, Net+, Project+, Security+, and multiple CIW certifications. He has been in the hosting industry for more than a decade and is founder of Lagniappe Internet L.L.C., a privately owned, completely debt free, hosting company based out of New Orleans. Robert's background includes 25+ years in programming, databases, networking and systems administration. |
