Joel Spolsky has an interesting post today on why he makes returns so easy for his company.
Amazon has really easy returns (though a little slow to process). But they're happy to let items cross in transit. No talking to people involved.
Home Depot and Lowes are very easy on returns. I once returned a flat of plants several months after planting season. No question refund. They encourage you to buy both and return the one you don't use (or your wife doesn't like). Last weekend I purchased three increasing levels of new stuff for grinding a hole in a steel plate, fully intending to return the unused ones. Lucky for them, everything was opened and no return.
Target is good on returns. My wife will frequently buy gifts, show them to me or find something better, and return them.
Some stores (especially women's clothing) are cracking down. And I know many women who deserve to be cracked down on (returning a worn dress is surprisingly common and pretty crass). But they should be very careful to distinguish between great customers who spend $300 and return $150 unworn and bad customers who spend $200 and return $200.
Your best customers may return quite a bit. And buy even more.