The cost of returns is usually more than paid for by the increase in sales that comes as a result. We tend to think of returns as a cost center and institute strict return policies. But research shows that more lenient return policies are actually better for two reasons. First, yes, people do return but they buy more things. They return more but they also keep more as well, and they share more word of mouth.

Zappos, for example, wants you to buy 10 pairs of shoes. Sure, you return eight of them but you keep a second pair when you maybe wouldn’t have if it wasn’t for that open return policy because you wouldn’t have bought as many in the first place. You also go back to Zappos the next time you want shoes.