A customer comes in to return a sweater without a receipt (still has tags) and refuses a store credit or exchange because she paid cash and wants cash back. She is frustrated and threatening to never ever come back to Macy's again even though she's shopped here for decades. The sweater is priced $24.99. Would you refund the customer in cash or explain Macy's return policy again and let her walk away?

If that is the correct answer, I'm glad I don't own Macy's. If the customer is a loyal shopper, she'll understand the store policy reflects an effort to reduce theft. I would explain this policy and the reason behind it (no receipt means no proof that she didn't shoplift the product, but I wouldn't mention such for risk of inadvertently implying that she was guilty of theft). I would remind the customer that her credit will be available to her immediately and she was welcome to select another sweater or product/item of her choosing. Regardless, I wouldn't refund cash without a receipt.

By the way, I answered this question incorrectly and also said I would not refund in cash and just continue to offer store credit. That's not the answer they are looking for. I was told the correct answer (as I listed above) by the interviewer. Macy's has done their research and a customer will continue to shop at their store if they feel their customer service issues are recognized and resolved. If a customer service issue is ignored or denied they will just shop somewhere else (in addition to that they will tell their friends and family not to shop at Macy's). Department stores are a dying breed in a world where Walmart and Target reign supreme and customer loyalty is what keeps these stores in business!

I agree that the cash is returned in this case--the sweater is $24.99. Of course, reiterate the store policy but developing customer loyalty is what will keep department stores in business.