How to Set a Retail Store Policy

Store Policies and Rules Are Vital to a Functioning Retail Business

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If you are in the retail business, a good retail store policies and procedures manual or template will provide a foundation to your success. But many managers struggle with how to do this.

To create a good manual, you will need to answer a number of questions, such as what types of payment you'll accept, what your pricing policy will be, and how you handle returns and exchanges. First, however, you need to determine when to produce this manual and how best to document it.


The best time to establish a retail store policy and procedures is during the planning stages. By anticipating problems before you open your doors, you can strategize how you'll handle special situations, as well as the normal day-to-day operations. This helps avoid making mistakes once you're faced with real-life customers.


Document each policy in a procedures manual or employee handbook. It doesn't have to be fancy: a three-ring binder that you can continue to update as time goes by will suffice. Make several copies of the manual, give one to each employee, and store a spare near the cash register for easy reference.

To begin creating policies, decide how you would like for your retail store and your employees to handle these items of business, then answer the following questions.

Types of Payment

The manual should help you determine all aspects of taking payments of customers.

  • What forms of currency do you accept?
  • What information is required from a customer paying by check?
  • Do you extend credit or offer terms to customers?
  • How do you handle returned checks?
  • Which credit cards do you accept?
  • How much money will you keep in the till?

Product Pricing

The manual should help you navigate the various pricing challenges that will crop up as you run your store.

  • What is your store's markup?
  • Have you created a pricing strategy?
  • Do you offer discounts on bulk purchases?
  • Do you offer employee discounts?


If your store offers layaway, you will need a section in your manual for that.

  • Will you allow layaway purchases?
  • How much will the customer be required to pay down?
  • How long do you allow items to remain on layaway?
  • Where will you store layaway items?
  • What kind of paper trail will you use to track layaways?

Returns and Exchanges

A clear policy on returns and exchanges will help prevent unhappy customers.

  • Do you sell any merchandise where returns are prohibited by law?
  • How liberal are you on returns and exchanges?
  • In what condition should the merchandise be returned?
  • Is there a period of time for which an item may be refunded or exchanged?
  • Will you require proof of purchase before exchanging or refunding?
  • What data will you collect from the customer on the Merchandise Return Form?
  • Where will your return policy be posted?

Special Orders

Special orders can please your customers, but they can create headaches you should be prepared for.

  • Will you special order merchandise for customers?
  • How much, if any, will you require as a deposit?
  • What will you do if the customer doesn't return for the item?

Hours of Operation

Having clearly defined hours are essential to prevent confusion with both employees and customers.

  • What are the normal hours of operation?
  • Will you have extended hours during the holiday shopping season?
  • What holidays will the store close?

Other Store Policies and Procedures

There are many other situations that will arise that aren't covered in the previous sections, so you should have another section for miscellaneous policies.

  • Who will be responsible for the general housekeeping of the store?
  • Will you offer gift wrap? If so, at what cost?
  • Will your store have a gift registry?
  • What's the policy for groups soliciting donations?
  • How will you handle product loss due to damage or theft?
  • What is your shoplifting policy and procedures?
  • Will your store have a gift registry?
  • What customer service practices will your store incorporate?
  • Does your store provide delivery service?
  • What will you do in the event of a power failure?

Think of your store policies and procedures as a guide, rather than being set in stone. In order to reasonably satisfy the customer, some situations may call for bending the rules. Make sure forms of payment, returns, layaways, and other policies are clearly posted for customers to see and maybe even included on your receipts. This will allow you to easily and confidently enforce your rules.

As your business grows and you gain more experience operating your retail business, periodically review and revise your policies as necessary.