What’s a Return Merchandise Authorization?

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A Return Merchandise Authorization is an approval by the seller of merchandise that allows the buyer to ship the merchandise to the seller for repair, replacement, credit, or refund. He authorizes the customer to return the goods and his unique identification number on the shipping label authorizes the seller’s shipping and receiving department to accept delivery of the package containing the return. A long-standing basis of mail-order transactions, Returns Merchandise Authorizations (RMAs), called Returns Merchandise Authorizations (RGAs) in some markets, became much more common in the late 20th century as retailers increasingly entered in the world of online commerce. The resulting distance selling made the delivery and return of goods increasingly dependent on shipping and mail services.

In most cases, when products are sold, the buyer has the right to return them. In most traditional retail environments, the retailer has a specific policy regarding merchandise returns, usually limiting returns to a relatively short period of time after purchase and further specifying minimum standards for merchandise condition returned for refund or credit. The customer takes the goods back to the point of sale with the purchase documentation, usually a receipt, and presents it for return. If the circumstances are consistent with the seller’s return policy, the seller accepts the returned goods and issues a refund or credit. Merchandise is normally replenished to the seller’s inventory and prepared for sale.

Buyers of goods from mail order and online sources generally have the same right to return the goods, but the process presents more of a logistical challenge for the seller. In the traditional environment, for example, returns are handled one at a time and are usually reviewed on the spot by the seller. All paperwork is also handled on site, as is refund or credit, and the transaction is complete when the customer walks away. When a mail order or online customer initiates the return process, a Return Merchandise Authorization is issued if the request complies with the seller’s return policy. In many cases, for reasons of efficiency, as well as environmental responsibility, the return authorization is incorporated into the shipping label used to deliver the goods, so the customer can reuse the shipping label to return the goods. Otherwise, when the customer prepares the return shipping label, he simply writes the return merchandise authorization number somewhere on the label.

The long distance returns process is very similar to the in-store process. The Return Merchandise Authorization typically captures all of the information that would be recorded in the store, and is often printed on the same document that the seller provides to the customer as a shipping label, so that relevant information can be read or scanned from the label without open the package upon receipt, making it easier to deliver the return package to the correct location. When the return package is opened, the condition of the returned goods is examined and, if acceptable, a refund or credit is issued.

A return merchandise authorization, therefore, is simply the reduction of the returns process to writing to facilitate the process of returning merchandise long distance for refund. The same process is usually applied to shipping goods to the seller for repair or replacement. In all cases, the Return Merchandise Authorization process mirrors the process followed when customers transport merchandise to the seller’s facility for return.

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