Costco can cancel membership return abuse customers: what you need to know

One of the biggest benefits of having a Costco membership is a lucrative return policy for items purchased at chain stores. Costco allows its subscribers to return almost any product at any time after purchase, if the buyer is not satisfied with it.

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The company guarantees buyers a refund of money spent on the purchase, but there are small exceptions in the return policy, writes Business Insider.

The exceptions are simple and straightforward: some electronics items must be returned within 90 days of purchase; diamonds - within 48 hours and with original documentation. Cigarettes and alcohol are not accepted for return, and products with a limited shelf life have separate return periods for each item.

While this lucrative return policy may be a way to entice new customers to spend $60 on an annual Costco membership, it has also been a source of abuse by the chain's shoppers. Stories on Reddit and Facebook tell of shoppers trying to return items they've already used, like a Christmas tree in January or a steak they've already eaten.

Each store manager may, at his discretion, decide whether to accept a refund, so sometimes such obviously fraudulent attempts may work. Costco does not indicate on its website that it is a violation of the return policy and whether too many returns may endanger your membership.

But in a recent company statement, a representative of Costco executives confirmed that there are cases where network membership may be canceled due to excessive enthusiasm for returns.

“In the event that a customer is not satisfied with a product at Costco, membership fees may be refunded and the membership cancelled. This decision is made on a case-by-case basis and at the discretion of the manager of the store where the return is made. Additionally, memberships may be canceled due to abuse of club member privileges,” a Costco spokesperson said.

Risk group

Maryam Nixolat, who has been a Costco member of 2006 of the year, said that she lost her membership earlier this year after she tried to return the printer she bought in 2010.

Nixolat said there were problems with the printer shortly after she bought it, but she could not get to the store to return it, for eight years after shopping. Costco has no deadline for most products.

Since printers are not on the list of electronics that must be returned within 90 days, Nixolat believed that she had the right to return this product even after 8 years. But when she tried to do it at the Costco store in Fairfax, Virginia, the cashier told her that he could not get a refund. The store manager explained to the woman that she could not return the printer, since she had already done too many returns.

Nixolat then called customer support and was tied up with Jeff Long, Costco Senior Vice President for the Northeastern States of the United States. Long said that the network intends to terminate the membership of a woman in her club, and that she will be informed about this by letter. The letter stated that Nixolat was losing Costco membership, while returning the cost of the annual fee, as well as the printer and ink it had acquired.

“From a review of your membership account, it appears that you are frequently dissatisfied with the products you purchase from Costco, and we are unable to satisfy you as a member,” the email said.

There seems to be some confusion in the return policy of the network. Two costco stores in Virginia told reporters that there were no restrictions on returns, and that frequent returns would not lead to the cancellation of membership. At the same time, in the stores of the network in New York and Texas, customer service representatives noted that the company tracks the number of returns that customers make, and that those who often return high-value goods may lose membership.

According to Nixolat, she returned an average of one item per year for her Costco 12-year membership, including a TV, a printer, and various food items.

According to the woman, the main problem is that she has items that she bought before her membership was canceled, and that she can no longer return them because she lost her membership.

System abuse

Profitable return policy is a valuable advantage for customers, but it does not often lead to abuse and fraud.

In February, 2018, the LL Bean network, announced that it was ending its legendary profitable return policy after some customers had abused it. Now goods can be returned within only one year after purchase.

At the beginning of this year, some customers in stores such as Best Buy and Home Depot were surprised to learn that their returns are tracked by a third-party company Appriss Retail. Appriss Retail has an algorithm that allows you to allocate customers who often carry out returns for a certain period of time or without the provision of checks. These buyers may be blocked in the future and denied the right to make refunds.

Such third-party companies are hired by retailers to prevent fraudulent returns, which are reported to cost retailers up to 17 billions of dollars a year.

Costco employees admit that return policies are often the source of difficult situations in the store.

“A woman came and returned two dirty toilets that she had bought online more than five years ago,” said one of the chain’s employees.

Many buyers, according to network employees, consider the goods purchased at Costco as rented with the ability to return them after a few years and get the money back.

Read also on ForumDaily:

Nine Ways to Save at Costco

How to buy at Costco without a club card

Costco cost savings: network tips

5 secrets of profitable shopping at Costco

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