8 Things You Need to Know About Your Customers’ Right to a Refund

8 Things You Need to Know About Your Customers’ Right to a Refund

If your business supplies goods or services then generally the following will apply:

  1. Your business is not required to give a customer a cash refund or a replacement simply because the customer changed its mind about wanting the goods or services.
  2. If you have provided goods or services that have a “major” problem then your customer is entitled to choose either a refund or replacement of a good, or a refund for unconsumed services.
  3. “A major” problem can include when a good or service:

(a) creates an unsafe situation;

(b) is significantly different from the sample or description;

(c) is unfit for its common purpose, or it won’t do what you said it would do, or it is not fit for a purpose the customer asked for, and can’t be easily fixed within a reasonable time;

(d) has a problem that would have stopped someone from buying it if they had known about it.

  1. A customer can also choose to keep the item or continue with the service and request that your business compensate it for the difference between what they paid and the value of what they received.
  2. If the problem is not major, then your business must repair or fix it within a reasonable time.
  3. If the problem is not fixed within a reasonable time, then the customer can have someone else repair or fix the problem, and recover the associated costs from your business.
  4. All problems that cannot be fixed are deemed to be major problems and will entitle the consumer to a refund or replacement of that good or service.
  5. For your business to be able to efficiently resolve disputes with your customers you should have comprehensive “terms and conditions”. They must not contradict the Australian Consumer Law and, to be enforceable, they must be properly communicated to customers.