When I first started my business – I’m sure like many other new business owners – I guarded my money closely and was hesitant to offer a money-back guarantee on my services. Then, a few years ago, while attending a networking event, the topic came up in discussion. As the facilitator of the event pointed out, if you believe that your product or service is of the highest quality, why wouldn’t you offer a guarantee? That made sense to me, so I immediately changed my attitude and policy. So it went for a couple of years – until recently. In the five months of 2010, I have been asked for a refund twice.

The most important thing to remember about refunds is to remain professional and honor your word. Recently, a client emailed me to let me know she didn’t feel like a priority in the process and wanted a refund. She was extremely polite about it, and I matched her tone. In my response, I told her I would be happy to terminate our professional relationship and outlined what parts of the package she had received and for what she had paid. She had originally requested half her money be returned, and after calculating time and giving her a couple of freebies, I provided a number that was a little less than half. I told her that, if she agreed to that amount, I would put a check in the mail to her that day.

The client’s response was what surprised me. Not only did she agree to the amount, she said she’d refer me in the future! I was dumbfounded. She had originally stated she didn’t feel like a priority, and here she was saying she would send referrals (note: she mentioned nothing about poor quality). I spoke to a couple of business colleagues about the situation, who were able to explain where I disconnected in the conversation.

I had honored my word and handled the situation with professionalism and dignity. I thanked the client for her feedback, acknowledged where I had fallen short (by delivering her document later than originally promised), and provided a reasonable refund amount. By not arguing with the client or discounting her, I maintained my integrity in her eyes – hence why she said she would refer me.

Refunds are going to happen, especially in a time when clients are struggling financially and having to make tough choices about where to spend their money. When you’re asked for money back, be sure you have a clear policy, learn from the experience to improve your business, and remain professional in your interactions. You never know what good might come from the experience.