How to deal with Refunds

With my clients I have in the wedding industry, refunds were generally unheard of. Photographers, videographers, planners and even coaches and consultants. Refunds were generally not part of the business model. When someone booked there was generally no need for a refund, unless something happened of someone was unhappy.

Refund culture has changed

Covid changed the model. It increased cancellations where people in their complete right had options for refunds. People in these industries generally didn’t hold on to the money to refund because of their cash flow in the past 15-20 years, they never had to have such a substantial amount to refund clients.

In the wedding industry people needed a refund because they couldn’t move to a new date, since 2 years worth of weddings were happening in 1 year. Contractually there were many different reasons why the refund was valid and had to be upheld by the supplier. 

Also with coaches and clients who planned in-person events, where they had to have to provide a refund because their attendees couldn’t go to the postponed event, or didn’t want to go online. This level of refunds has been completely unusual, and has subsequently very hard to deal with for many which is why this is so topical.

We are creating a legacy life, when we think about things such as abundance and growing your business, seeing the money flow out of your account at what may be very substantial rates may influence what you believe about the law of attraction, abundance, your business and the rate at what it is growing.

I’m excited to dive into this topic because it is not often talked about. It’s like a secret part of business. Talking about refunds can get awkward very quickly from both a business owner's and client's perspective. It can bring up mindset issues like insecurity.

Don't Panic

There are two camps of refunds: those who have already had to deal with refunds, and people who are worried about what to do when someone asks for a refund. The first thing to do whenever you get a refund request is not to panic. Remember every business owner on their journey will get a refund request. It’s just that many of us don’t talk about it.

When you get the request, before getting into the specifics, I want you to firstly affirm, using affirmations or meditation, as to why you are great. So when you get the email, do not read it and connect with your affirmations first.

If you have a smile file, which can be an email folder, a printout, it’s a place to that has clients saying amazing things about you, go and read it. Make sure you’re connected with your abundance muscle and the power of the universe. There will always be more clients and there are always more than enough clients for people who are looking for them.

Why do we need to do this? Let me run a scenario. You get an email that says refund in the subject line and you constrict, we get worried, we panic, we are in lack. Because we don’t like the word refund. If we are in that mindset we interpret language differently. Which is why I want you to be in connection with how great you are.

Often refunds are written and not verbal which means there’s no tonality. As a language specialist, I see so many issues that come up with this. I mean that when we have verbal communication, you can understand my intonation patterns and tonality. If you just read words, you are reading them in your own tonality and not mine.

What can happen is that someone writes that they would like a refund intending to say it in a neutral tone but when you are in lack, you could interpret it as aggressive. That’s two tonality patterns on top of the same language. That can be the start of the issue with some of the refunds. Because we are reading it in our model of the world and not how the client said it.

Banking on the awkwardness of the situation

Some people are banking on the awkwardness of the business owner when they see the word refund. I often joke that I’m British and we don’t like to talk about sex and we don’t like to talk about money. Those are two topics of conversation that people will get out of ASAP.

So if someone is asking for a refund and they are banking on the fact that you want to shut down this conversation, you may handle it differently. Others sometimes will make unreasonable requests.

Some months ago someone bought one of my courses called Persuasion and they were charged twice. As soon as it came in, within 10 minutes, the team realized something went wrong and refunded it straight away. The price was about 93 sterling. However, the person then wanted compensation in the form of a 1 to 1 immersion experience with me, which is worth over four figures.

So sometimes people are going to have unreasonable requests and as long as you know that there are two points to refunds, you can then stand in your power. One is a boundary and one in the process. You have to know your boundaries and you have to know your processes.

First of all, do you have a money-back guarantee? If you are a business owner or entrepreneur you need to exactly know what your policy is regarding refunds. Especially if you are a service-based business. You need to be prepared for them.

Say you are a graphic designer or a brand consultant, the client will brief you, you will then present first edition logos and have a revision if they want to. At what point does your refund policy work or expire? Where in that process does it work, especially if you have a staggered payment structure?

Review your policies

If you have a refund policy or money-back guarantee, have you reviewed it recently? Does it cover travel or the pandemic if it is of concern? Even if you think to yourself that this does not affect me right now, if you have a client on a contractual basis and you have said in your contract that the work is going to be done at a certain point in time, then what happens if that client did get sick and can’t get the work done in that time frame.

Also check your policy denotes the domestic country or state where your company is resident of, that should be the legal governing body of it. Otherwise, sometimes clients might think that it’s legal where they are based and not where you are based. Especially if you have an international company, where you live might not necessarily be the legal residing country that might oversee this if there are any issues.

Especially if you have international clients. It should be on your policy or your contract or your guarantee. Also, don’t forget to get it checked by a legal representative. I’m going to say please don’t copy someone else's policy of the internet because you might end up with no protection at all. It might contain protections in a different legal area.

Understanding the refunder's drivers

When we come to refunds, understand the drivers of why the person is actually asking for a refund. Are they genuine, do they have a genuine right to be asking for a refund? Are they within your refund timeframe, within the scope of the contract, they are simply exercising their right as you have laid out?

Another drive can be that they need money. I have seen this before in courses, memberships and programs and learning institutions where people have very long money-back guarantees. Say that you sign up for a year-long course and you can ask for your money back within that year. Let’s see why that could be an issue? What happens if that person just needs money?

If your money-back guarantee finishes around Christmas that might be an issue because some people might be short on money and cancel your service just for that. It does not even have to do anything with the quality of your service or product if people just cancel it for spending power.

Be aware when someone needs money are they actually out of your refund policy or your money-back guarantee. Some people will find fault or blame or anything to get a refund out of you when they need money.

This is why again, go to your happy place and your smile file because if someone is looking for any reason to ask for their money back if you take that personally it’s like a body blow. It can actually be untrue what they are saying. People can also threaten to take you to court or an industry body.

I’ve seen this with clients that they were threatened to be defamed and people contract quickly and just giving the refund because they don’t want to deal with cancel culture and someone going all over their business social media accounts, even though they don’t have any legal right.

I’m going to say to you come from a point of peace, because what is being said to you it’s a threat, a threat of action.

Another area is fees and exchange rates. Especially if you have an online course or program or take payments via international transfer.

If you decide to refund the whole course fee, you can end up paying more than you made from that customer because you have to pay the fees back if you went through a payment platform. So if that is something that is resonating with you and you need to look at in your business. It needs to be in your terms and conditions again so that you are not out of money and have an admin fee for doing it to cover the fees.

Mindset of refunds

I want you to really think about the fact that the refund really often is not about you. It’s about the person who is asking for the refund, why are they doing it? I want you to think about the next time you will get a refund request, ask yourself, what is going on for that person, what is going on in their world model, their life.

Why are they asking for it? When we move from a place from being attacked when someone is asking for a refund to actually getting curious about the person who is asking we can sometimes uncover things. Sometimes you can uncover that they sometimes do not want a refund but for whatever reason isn’t happy.

It doesn’t mean anything about you as a person. If someone asks for a refund in your business, it doesn’t mean you’re less than, you haven’t changed who you were before you saw that request. You are still a whole amazing awesome person. It’s not a personal attack, it’s a business request.

I know if you’re an entrepreneur and you built your business from scratch, it can be really difficult to find those boundaries because you treat clients personally and you have to switch back that this is a business request.

I have never met a business owner yet who hasn’t had somebody who wanted a refund at some level. Even if there is nothing wrong. Nothing has to be wrong for someone to want a refund, something just doesn't have to be right. You can’t control it coming, I but you can control yourself. You can control how you reply. You can control the impact you allow it to have on you.

I have a phrase that I say to anybody when something comes up. This is not limited to refunds but to business in general. Never ANGRY TYPE. I truly feel with the laws of vibration that you can feel when someone is angry typing, the language is different. Again don’t reply from a place of lack because your language will be different. The nuances will come across from angry typing. Always type at peace.

I and my husband were doing our latest house renovation and had an issue with our chimney. Instead of fire going up the chimney, water was coming down the chimney. Pretty big problem because the water was coming into our living room. Not just a drop or 2, when we opened the wood burner it would just come pouring in.

We were discussing with the people who had it installed where the issue was. We got a letter from the owner of this business and it, funnily enough, was an example of what not to do. So this letter arrived, it was all in uppercase. All in caps lock. It was one large sentence structure so no line breaks. It could be 8 paragraphs but it was just one, the sentence structure was extremely long with very few full stops.

The only way I can describe it is that somebody was yelling at you. There were so many examples that someone was not responding at peace. As a client you don’t come back from that and think okay we are looking for a resolution. That is an extreme case.

But for you, think to yourself. When you are replying to someone who is asking for a refund. Are you replying with the same love and compassion when you first onboarded that client? If there is a different energy and tonality than before they will pick up on that.

Know your boundaries, and I’m not talking about giving in. If they have an unreasonable refund request know your boundary, policy and guarantee in your contract. But you can still do it with love and grace.

Handling refunds and your mindset

I want you to depersonalize the initial audit to see if there is validity to the refund. So if you think about it right now, if someone were to ask for a refund, not a personal attack, not your business, how would you handle it? Go through and see the validity of the request and then work out how to deal with it. Then you can see if you actually have someone who has a valid request.

Is a refund request a hot potato for you? If you see a refund request come in, do you want to shut it down and go away as fast as possible? That’s a hot potato, just passing it quickly between your hands and wishing it would go out of your life as fast as possible. Does it make you feel like that? Are you acting in a way like your future self wants you to.

An example of this would be if you had a refund request and it’s a hot potato for you. You don’t necessarily want to refund the client because they have an unreasonable request for a refund. It’s not in the contract, no refund is actually due to them. But it’s a hot potato for you and it makes you feel awful and you just want it to go away, so you end up just refunding them to make it go away.

Then in 2/4/6/8 months, you think about why you even did that and wished you didn’t. Are you refunding in a way that your future self also would be at peace? If it is a hot potato for you, get one of your trusted advisors on board, get your coach, someone in your support system to help you deal with that. Always ask yourself would my future self be happy with my decision.

When we come to the psychology of refunds, it’s very much like the psychology of negotiation. Do you know what resolution you would like before you even reply? Sometimes the first reply isn't even in response, it's about evidence and information. You might need more data and evidence to know what they are actually talking about.

If you are further down the refund process, what is your resolution? What do you want to happen? You need need to know your end game. If you don’t know often, even if they are going to be an ex-client,  they don’t know what they need or want. So what specifically are they looking for, and what specifically do you want? 

So are you willing to refund them if it isn’t a reasonable request and what do you want to happen next?

You have to be specific. This is the thing about the hot potato.  They say how can I make this great for you or how can I make this awesome for you. Ask the person asking for a refund, what specifically do they want.

You are putting it back on the person. As a tactic, it can be really great to say.

If it is a reasonable request and you are going to admit liability then you say I’m sorry and that you will take liability. Keep in mind that we are in a business transaction so you have to be aware if you are taking liability here. So you have to be specific. What do you want to happen next? What resolution do you want?

If you don’t know that, might shut it down and refund when don’t want or need to, and you are going to be annoyed at yourself in the future. My final question for this is really simple. Imagine that the roles were reversed. Imagine that you are the client and the client is you.

If you were sending that refund request, how would you like to be treated? Because they might be very awkward as well, they might feel all things you are going through. ‘’I don’t know how to ask for this’’.

When we treat others as we would like to be treated ourselves, we can also have very different outcomes. 

If you're looking for support to move your business and life forward, you can work with me in the following ways:

Firstly a 90 minute on demand session, for a super boost of top-line strategy for how to kick off your 2022 for success.

Secondly a private accelerator day in person or on Zoom and 30 days of support, including 2 121 sessions. 

And if you are ready to work together 121, then why not come and listen to the podcast over on Apple Podcasts called Wielding Legacy