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Warranties and return policies for crowdfunded items & pre-orders?

For a crowdfunded hardware company how do you determine the warranty and return policy? I haven't really seen other campaigns discuss this upfront, usually it seems to be something that people post only after they've been shipping for a while. What have people generally done/seen for crowdfunded hardware products or pre-orders?

4 Replies

Joanan Hernandez
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Joanan Hernandez Entrepreneur
CEO & Founder at Mollejuo
Hello David,

When I pledge for a crowdfunding project, I know there's a risk involved. I'm sharing the dream of the project with that entrepreneur. For that, I'm not expecting a whole finished product, warranties, and so on and so forth. If I want that experience, I don't do a pledge in a crowdfunding site, I go out and buy it on Amazon or any other site.

People shouldn't be going to Kickstarter or IndieGoGo to buy stuff. If they're doing it for that reason, they're doing it wrong. People should be going to crowdfunding sites and pledging their money, because they want to be a part or help that project. That's it!

Maybe I'm being naive and that's the whole point of crowsourcing.

Of course, other would disagree.

That being said, delivery logistics is one of the most underestimated head aches of any hardware project. I would assume that if the project becomes big, then it makes it easier to afford those logistics, then again logistics can eat out other costs.

Cheers!
Derek Dukes
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Derek Dukes Entrepreneur • Advisor
Business Development, Startups at Amazon Web Services
The approach should be based on how you're presenting the product. If you're positioning it as a alpha / beta / dev version then you'd warrantly / refund it in the same way (e.g. no returns or warranty).

If you're presenting it as a more finished product, or wanting to keep any early adopters excited and from saying bad things about the product publically, then you'll want a more formal return / refund policy.

You can always decide on case by case basis, esp. if the total units is under a couple thousand for the campaign.

The most important thing is to be upfront about what your policy is, how you'll deal with any problems in the work that you or one of your suppliers performs. It's yours to position.
Joanan Hernandez
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Joanan Hernandez Entrepreneur
CEO & Founder at Mollejuo
Hello Derek,

While I agree with what you propose, allow me to counter argument:


Cheers!
Jack Al-Kahwati
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Jack Al-Kahwati Entrepreneur
Entrepreneur
In our terms of service, we have limited returns to 90 days from the pledge date. However, in practice, we've decided to just offer a refund to anyone that asks. Once the product is made, the return policy is usually negotiated with your CM.
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