In the world of fashion and shopping, aside from having trademark products that help your consumers remember your company, you must provide good customer service. You need to address any concerns or complaints your customers have and offer them a solution for their own convenience if you want to stay afloat. And while many famous companies are doing this, mainly in order to preserve their customers’ loyalty and their own reputation, it seems not all companies are. One of the most famous companies around the world that’s been drawing attention lately for this very reason is LuLaRoe.
LuLaRoe Retailers Clearly Didn’t Like Their New Return Policy
LuLaRoe is a multi-level marketing company that’s known for producing high-quality mirthful dresses, and has been doing so for the past few years. Unfortunately, its recently released wild-patterned leggings received some complaints from customers because the clothing can be ripped very easily, like that of “wet toilet paper”. The company still hasn’t been able to settle these complaints, and now, it seems they’ll be facing yet another major issue.
In the recent class-action lawsuit, the independent fashion retailers of LuLaRoe who wanted to quit their business are angry about the company’s recent change of policy they weren’t aware of. Not only did LuLaRoe change their policy without consulting them, but the said change will cost them thousands of dollars. Where did this issue begin, you ask? Well, back in April, LuLaRoe offered help to their retail partners make a smooth the transition if they wanted to quit their business. The company offered a buy back money guarantee for the unsold inventory in which the retailers had already paid in full for. LuLaRoe even offered to pay for the return shipments. Suffice to say that the fashion retailers were satisfied with their customer service.
@LuLaRoe Please give clarification on the new return policy. This literally ripped the rug out from under MANY trying to GOOB the "right"way
— LuLaRoe Jennifer Roe (@LularoeJenRoe) September 14, 2017
However, LuLaRoe seemed to have a change of heart when they sent out an email notification last month. The email stated that LuLaRoe would immediately cut the buy back percentage and change its shipping terms (whether or not it’s still free is a mystery). This abrupt change certainly angered the retailers who planned the transition in advance. Apparently, since the abrupt changes meant taking more money out of its retailers’ pockets, some retailers couldn’t help but speculate that maybe the financial stability of the company is declining, seeing as they’re now charging their retail partners for shipping. However, LuLaRoe was quick to dismiss the rumor, saying that the company is still “strong as ever”.
Furthermore, the company explained why they revoked such feature to their exit retailers.
@LuLaRoe changing your policy after someone requests shipping labels and that person isn't qualified for 100% buyback suddenly? Scam
— Lisa Schwarz (@lularoelisa651) September 14, 2017
In a statement issued by LuLaRoe, it was revealed that some retailers are abusing the program to test their business. When the business wasn’t selling well, they quickly returned all their unsold inventory between the months of April and September of this year in order to file a waiver and still be eligible to the 100% buyback and refund guarantee, not caring if their stocks’ quality had declined.
“We decided to end the waiver when it became evident that a good number of retailers were abusing the program by returning products in extremely poor condition and providing inaccurate claims, as well as retailers using it as temporary solution… [for]their business.”
What Can You Now Expect When You Exit The Company?
Because of the new policy, the retailers who wish to exit the company will only receive around 90% of what they paid for the inventory. However, the 90% buyback guarantee only applies if the unsold inventory products are still in perfect condition and were purchased no later than last year. Any poor-quality or defective products that were purchased before 2016 will not receive any compensation from the company at all. Furthermore, you may also need to shoulder the shipping fee the moment you return those unsold inventory products back to the company.
— Erin Winter (@ErinWin30424684) September 14, 2017
The retailers were enraged because just a dip of 10% is going to lose them thousands of dollars in the process. And ironically, there’s no guarantee that they’ll get their 90% buy back guarantee, because it’s up to the company to decide whether or not the products are still in pristine condition. These businesses also have to pay the new shipping fee.
Although LuLaRoe said the eligible retailers, during the timeframe of the waiver, will still receive 100% full buy back guarantee and refunds for the shipping fee, the retailers are still uneasy. After all, the company ignored all incoming emails and phone calls after the notification was sent.