A few weeks ago, I placed an online order with a clothing retailer that I’ve been very happy with in the past. Unfortunately, all of the items that I received in this order were either the wrong size or of a low quality. Since the retailer charges for returns by mail, I walked to the local store to see about doing a refund or exchange.

Upon arriving at the store and seeing their inventory, it was immediately apparent that an exchange would not be the right move. They didn’t carry any of the products I was returning, so my only options were to buy something different, or just get my money back. I opted for a simple refund, and I’ve yet to order any replacement items.

This experience underscores the importance of making exchanges as hassle-free as possible. Think about it: if the customer wants a different size or a different item, do you really want to charge them for that privilege? The prevailing wisdom — except at forward-thinking retailers like Amazon and Zappos — seems to be to penalize the customer for exchanges.

But if these policies push people away from exchanges and towards refunds, it’s rather obvious that the retailer is the ultimate loser. That sale is gone, without an offsetting exchange to replace it, and the customer will probably think twice before shopping there again.