NetEqualizer Direct Sales and Restocking Fee

A customer recently stated that the restocking fee we charge gave the appearance of a lack of confidence in our product. I can appreciate that perception, especially with all the failed products many IT professionals have been burned with over the years.

However, here is the official reasoning behind why we charge a restocking fee.  As taken from my response to this customer:

The restocking fee has its roots based on a couple of factors

1) The restocking fee is designed to make sure we don’t get inundated with requests for free units from customers that are “just looking”. The other vendors  you mention charge much higher prices, sometimes four times as much,  and they typically use a channel that already purchases stock for the purposes of demo’s. All of this cost gets passed along to the customers that end up buying the product (basically covering the cost of dry wells).  We sell mostly direct and with  no local presence it is difficult to know a customer’s buying patterns.   You’d be surprised how many customers will trial something  without any intention to purchase.  But, many times it is not the immediate customers fault as the CIO might change the IT manager’s  budget, etc.

2) We are  not 100-percent certain that our unit will solve your issue. I’d  say we are closer to 80-percent certain based on what you described, but we will easily provide you with $200 of support helping you figure out what your issue is. You will have the chance to talk directly to our engineers who trouble shoot thousands of networks a year with similar problems. We do not want or pretend to be a consulting company, but we don’t want to consult without recouping some of our cost either — especially with our low margins which we are already passing along.

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