5 Strategies To Manage Refunds and Cancellations During The Corona Virus Crisis

Corona Virus Effects On Business

Corona Virus has affected all businesses, micro, small, national and global. As a result, small business and solopreneurs are having to manage refunds and cancellations of services and orders, which is having a severe negative impact on business.

Restrictions in travel and public gatherings have resulted in:

1. People cancelling attending events such as retreats and workshops and conferences
2. Cancellation of events such as retreats and workshops and conferences
3. People cancelling other services such as dinner reservations for parties and children’s activities
4. Requests for refunds
5. Lockout from sporting and entertainment events due to last-minute cancellations bought about by government bans of large gatherings.

There is no doubt about it – these are challenging times and there are no winners. We have to help each other.

As a solopreneur or small business owner, your navigation of this unprecedented period of business uncertainty is critical. It helps to remember that you will be seeking to cancel services and seeking refunds, as well as being on the receiving end of refund requests by clients.

It is important to know your contract and engage with your clients with flexibility, compassion, and understanding as well as the confidence to negotiate solutions that minimise loss for both you and your client.

5 Strategies to Manage Refunds and Cancellations

Here are 5 strategies to manage refunds and cancellations requests of your services during this Corona Virus pandemic management period.

1. Family Comes First.

Look after yourself and your family first. If you need to deal with your or your family’s health then do so. Email your clients and let them know that you will deal with their concerns or requests in due time.

2. Review Your Refund And Cancellation Policy With Clients

For businesses that have a service agreement or a client contract or business terms and conditions – it is time to look closely at your contract, review your refund and cancellation policy, and apply it.

Your refund and cancellation policy – including termination – should be clearly outlined in your service agreement or client contract.

It is best to seek legal advice if you are confused or concerned about:

• how to refund if your client cancels
• the refund ramifications if you cancel an event
• the refund ramifications if you are forced to cancel an event because of reasons beyond your control.

If you do not have a service contract, please seek legal advice and get one that will provide you with a platform of negotiation with your clients in times come. It doesn’t pay to be without a service contract to provide direction for you and your client about your business relationship.

3. Treat Each Request Individually

And also look into the reason for cancellation and your contract carefully. You need to work through your contract to determine when a refund will apply and what amount of refund.

Where people are choosing to cancel according to your refund and cancellation policy – for example, within given timeframes – stick to the refund and cancellation policy that you and your client have agreed to and refund (less any fees if agreed to).

Do not introduce a new Corona Virus cancellation or refund policy and assume it will be accepted. People are under no obligation to take any notice of any new policy if they have an existing agreement with you.

If you are offering an advantageous cancellation or refund arrangement, ensure that it applies to all clients. In the small business space, clients and suppliers talk to each other and word travels fast. You want to maintain consistency, transparency and fairness in your response and treatment of clients.

Be careful about waiving your refund or cancellation policy in whole or in part. It may jeopardise any insurance claim your client may have – so please have this discussion with your client.

4. Communicate and Negotiate

Where cancellation is the result of an event, service, or delivery being cancelled because of government travel restrictions or bans on large gatherings, then consider negotiating delayed outcomes and payment options with clients.

For example, can you:

• offer a credit note or voucher?
• reschedule the event to later in the year?
• consider negotiating friendlier payment arrangements with clients where possible by spreading payments over a longer period?

Use your contract as a platform for negotiation.

This Corona Virus crisis will pass and business and life will return to normal.

Work towards building and re-enforcing relationships. How you respond today will determine if clients return to buy from you when the current situation returns to normal.

5. Get legal advice

There are some important reasons to consider getting legal advice about your response options, legal position and your contract :

• if you used a template for your contract and did not have your completed template reviewed by a legal practitioner you may need that review now to ensure your understanding of the contract is correct.
• if you feel confused about your current contract. Stress, overwhelm, can cause you to feel confused about your circumstances and your contract.
• if you have questions about a “force majeure” clause or “frustration” of the contract – these are complex clauses. Reliance requires very particular:
  • circumstances
  • proof requirements
  • wording
  • particulars of a contract
  • industry conditions
  • and an understanding of how courts view and interpret the use of these clauses in any given circumstances. Which includes the current situation with a pandemic.

If these clauses are on your mind, legal advice is essential.

Book In Now

If you:

1. Are wondering how to navigate refund and cancellations requests in your current client contract or service agreement
2. Do not have a contract and you are wondering what to do about a request for refund or cancellations
3. Or you wish to cancel a service and request a refund and require advice and support.

Please book in a session here.

This session is specifically for the management of requests for refunds and cancellations advice. Sessions are limited.

If during this session it is determined your contract needs to be reviewed or a new contract is required, you will be provided with a separate quote and the fee for this session may be deducted from further work regarding your service contracts.

XX Shalini