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Should I refund?

I have got a B2B product.  Recently 1 customer purchased 1 license and within minutes started complaining about speed and asked for refund.  We immediately responded within an hour and told him to enable some settings in the product to improve the speed. which he could have also easily explored by just clicking the Settings menu.

The settings did improve the speed but next day he again  complained of something else and asked for refund.  We responded on how to fix the issue and clearly told him we don't have a refund policy because it will be impossible for him to return the product. 

Now he is again complaining of something else and telling that he has not heard  of no-refund policy and telling  me that if you do not have refund policy you can't sell product in US.

Please note that my product doesn't have any serial number or keys so that we can disable the product.

The license price is $300 and we don't sell large volumes. We are very micro ISV.  We have many satisfied customers over the years

What should I do now?  Please advise?

Thanks
Shahryar Send private email
Thursday, May 09, 2013
 
 
I would. Leaving the moral & legal rights and wrongs out of it you may well get more than $300 worth of trouble from them. At this point it's unlikely you'll get a happy customer who tells their friends. More likely you'll just get a charge back a month from now.
Jonathan Matthews Send private email
Thursday, May 09, 2013
 
 
I have successfully not refunded couple of times when I had a similar situation (purchase than immediate ask for refund)..
What I once did was look up for customers email on Google and I wasn't surprised when his email was listed in a 'fake buyers'  site or something like that, I don't remember exactly any more.

So try to Google as much as possible about him - maybe you find that he is a serial porn site owner, or known for illegal stuff...

About 'he will tell his friends' argument.. well that is just stupid I must point out... Unless you are selling something that is bought in large quantities by everyone (coca-cola or Ipod)...How many friends can he really have who would be interested in the same product?

Much like as  when Seinfeld said:
Why do they have tiny slots for used-up blades in the plane toilet. Who shaves on the plain? And shave so much that they are actually using-up blades..."
alexandar Send private email
Thursday, May 09, 2013
 
 
> How many friends can he really have who would be interested in the same product?

I'm using the friends argument partly as a metaphor - often the problem won't be literal acquaintances but people bad mouthing your product on-line, say on a review site, a blog or a forum related to your product.

I should qualify that I haven't seen this happen for desktop apps on the web for misv products - but it is a big problem for larger players and everyone in an app store. Personally I wouldn't risk it, especially since a charge back may be just around the corner anyway.
Jonathan Matthews Send private email
Thursday, May 09, 2013
 
 
@ Matheews
I was a bit rush, I didn't mean to offend when i said 'stupid'...Bad word did I choose... The idea was exactly what you have said  - it is an issue for big players... misv not so much
alexandar Send private email
Thursday, May 09, 2013
 
 
Thanks Mathews and Alexander for responding.

I just googled to see the return policy for other software vendors.

Most of them are not offering refund if the package is unlocked or opened. 

Maybe I should take some time before deciding
Shahryar Send private email
Thursday, May 09, 2013
 
 
I would just give the refund and move on.

You may find you have to anyway, via chargeback if they paid using a credit card.

Also, there are some pretty strict regulations in the EU for example, that mean people get to try things out and get a full refund if not satisfied (Distance Selling Regulations, etc). The credit card companies know this, so will usually do a chargeback after a simple phonecall, leaving the vendor out of pocket.
Scorpio Send private email
Thursday, May 09, 2013
 
 
> Please note that my product doesn't have any serial number or keys so that we can disable the product.

You should implement keys with the customer's name. It doesn't have to be foolproof or elaborate or uncrackable. But some sort of license traceable to the customer will reduce casual pirating.
Scott Send private email
Thursday, May 09, 2013
 
 
"Most of them are not offering refund if the package is unlocked or opened. "

These are illegal terms in most states.

I have successfully returned crapware with this clause simply by calling the credit card company.
Scott Send private email
Thursday, May 09, 2013
 
 
Unless this customer is the final person on earth who is in a position to buy your software, issue a refund and go looking for other customers.  Don't make business personal.
Howard Ness Send private email
Thursday, May 09, 2013
 
 
What Scott is saying is effectively the same as what I mentioned regarding the EU, so if your customer is in the USA or the EU, then you should give the refund immediately or you'll end up with a chargeback.

Life is too short to worry about one unhappy customer. Refund, apologise and move on.
Scorpio Send private email
Friday, May 10, 2013
 
 
>Please note that my product doesn't have any serial number or keys so that we can disable the product.

So, are you saying that there is no trial *and* no way to get a refund after purchase? If so, I would be highly unlikely to buy your product, unless there was absolutely no alternative.

Almost everyone has a money back guarantee on software. Why are you being different?

I sell a $300 version of my software to businesses and I can't remotely invalidate it. But I still offer a money back guarantee.

See also:
http://successfulsoftware.net/2010/01/11/offering-a-money-back-guarantee/
Andy Brice Send private email
Friday, May 10, 2013
 
 
@ Andy "So, are you saying that there is no trial *and* no way to get a refund after purchase?"

He is not saying that... Maybe he has a demo with some features disabled (e.g. save as )
alexandar Send private email
Friday, May 10, 2013
 
 
ALWAYS REFUND.  The two main reasons:

(1) You don't succeed by making enemies of your customers, who, in turn, will post their story to a forum and then millions of people will see how you treat potential customers.

(2) They can get a refund from their credit card company anyway, who will penalise you for it.  Better to refund yourself and avoid the penalty.

Always refund.
Harry Phace Send private email
Friday, May 10, 2013
 
 
Thanks for all of you.

@ Andy . Yes we do offer a fully functional trial edition without any time limits with some features disable.

In the past I have refunded immediately without any second thoughts and sometimes also declined successfully.

The reason I have posted here is that last week I got a support email from a customer who has purchased  last year and  I accidentally found  this customer order was refunded.  He is still using our product.
Shahryar Send private email
Friday, May 10, 2013
 
 
"I sell a $300 version of my software to businesses and I can't remotely invalidate it. But I still offer a money back guarantee."

We are in the same bucket, money back guarantee policy, and in practice we'll refund even far outside the refund window. We also don't phone home or invalidate. What happens if you keep the software is you can't get updates, bugfixes, or customer support anymore.

I've never seen even one case of someone getting a refund and continuing to use our software. There was one case over the years where I strongly suspected that happened, but I am now pretty sure I was wrong.

We do have occasional problems with stolen credit cards being used to get keys which are then put on crack sites. That's not a false return though, that's someone other than card holder stealing numbers.

The main piracy issue we have is:

- friends giving a copy to friends
- students making a copy of the one in the school computer lab

Since the license is not machine locked this works fine for them.

I have informal ways of tracing when this happens. Over the years a lot of sales have come from people running pirated copies and dependent on our software who need an update or support, so they buy it then.
Scott Send private email
Friday, May 10, 2013
 
 
"The reason I have posted here is that last week I got a support email from a customer who has purchased  last year and  I accidentally found  this customer order was refunded.  He is still using our product."

Well that's an entirely different case from what you originally posted.

When people without a valid license request support, I email them politely and noting along the lines of "Before we can offer support, since there was some confusion on the license, we'll first need to get your license situation normalized. To do so, please purchase a license at this link and then I will be more than happy to help you with this."
Scott Send private email
Friday, May 10, 2013
 
 

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