How Free Returns can ruin your business !!!

[ancientcoins.market]

After eBay rolled our Free Returns we testit for a almost 2 months and here the Results.

As Top Rated Seller we work hard to maintain these standards and -10 % discount at final value fees. Ebay canceled this discount and start offering only to accounts that offers free returns promising higher Conversion Rates, new potential customers etc...

Reality check

Our business went nose down, cash flow froze in returns , we lost money with returns shipping labels/ insurance. -10% discount, can't even cover 2% of returns labels.

In long run, eBay lost revenue from us since before would get monthly 3K-5K in fees, now it's getting monthly $500 -$700 in fees.

WHY ??

Free returns gave people the initiative to returns things because they changed their mind, because of buyer's remorse, or simply because it's end of the month, they ran out of money and easy solution is to return what they bought.

FREE RETURNS MEANS FREE MONEY.

If you are doing auctions on eBay, free returns will ruin your business. Auctions should have a different policy as many big companies have. When you participate in auction, you should be in legal binding to pay. 

With free returns all auctions went in garbage. What is the purpose to spend efforts and money in (ad's) to create exciting auctions with over 100 bidders, when  winner (changes his mind because he feels he overpaid or maybe because he don't like it any more??? ) 

Here are some returns reasons during last month.

" Cool coin change mind"

" I took if for a ride to show to mi friends dont want it anymore"
" just return it"

"Was bidding for fun since you have free returns, I won't pay so I will save your return shipping money"

"no hard feeling run out of money, will return this"

Ebay is trying to compete with Amazon. Looks like Amazon is having a better laugh since it is understanding better than ebay, Ebay's business model.

Ebay backbone is common people that sell and buy between them. They are the biggest revenue for ebay, not big companies. Big companies have same marchanised in multiple sites ( Amazon, Ebay, Etsy, ) ebay fees from them are less than 20% of ebay annual revenue. 80% comes from ebay sellers.

If Amazon destroys  backbone of ebay, Ebay stock will plunge down and Amazon's up since will get ebay potential buyers.

Remember : "Free returns"  are very hard on Amazon.

Dear eBay Team . To makes it easy for you to understand what is going on.. here's an explanation with photos from Plankton and Mr Krabs 24 hours service competition.  

  

Dear Ebay community. 

Please thumbs up this post, but most importantly  we need your comments

[shinwell_johnson]

Tough times...

You have great items, and a great business, with decent (or better) established sales. Stay the course.

Sales may be down right now, and they may be down again tomorrow. And the next day.

That is the nature of retail.

You've put in the time and effort, now put in the extra determination. If you can do anything to help yourself now, I suggest you need to DIVERSIFY your marketplaces. Seek out alternate growing markets and expand your presence.

[mulligan_outfitters]

it can ruin a coin business.

[pauls-parts]

"This ignitor did not fix my problem. I will be sending it back. I see you have a ballast that might work. I want to try that one since the shipping is free and I already paid for the part."

When I was offering free returns. I actually got this text from a customer. With in the first month I had to stop the free returns or I would have been out of business. I am not a shoe store to just try things on.

[mam98031]

As Top Rated Seller we work hard to maintain these standards and -10 % discount at final value fees. Ebay canceled this discount and start offering only to accounts that offers free returns promising higher Conversion Rates, new potential customers etc...

Ebay did not "cancel" the program.  They changed the requirements for TRS+.  Ebay does change various policies from time to time.  As they did with this one.  They did NOT change the TRS program, just the requirements for TRS+.

Free returns gave people the initiative to returns things because they changed their mind, because of buyer's remorse, or simply because it's end of the month, they ran out of money and easy solution is to return what they bought.

That is absolutely a down side to Free Returns.  However Free Returns is not a new program.  Ebay just started calling it Free Returns, but it is a return policy that sellers have had access to for a very long time.  30 or 60 day returns with Seller pays shipping.  And that is how it appears on the listings.  So it isn't a new program.  However they have given this return option some perks that can be important to some sellers, so it is important to consider them.

Ebay is trying to compete with Amazon. Looks like Amazon is having a better laugh since it is understanding better than ebay, Ebay's business model.

That's is certainly debatable.

If the program is not cost effective for you, you do not have to offer it.  You can retain your TRS standing but not the TRS+ which is only the badge and 10% discount on the FVF [$10 per $1,000 in sales].  

For some sellers that discount is very important for others, it isn't worth moving to Free Returns.

I decided for me, it wasn't going to work well, so when the new requirements came into affect, I dropped TRS+ as the discount just wan't meaningful enough for me to take on the risk of Free returns.  I know for other sellers they like the discount and would prefer to keep it.

It is just a decision we each need to make for ourselves.  Stay TRS but give up the discount.  Or keep the discount and move to Free returns.  There is no right or wrong answer.  We each just need to decide what is best for us and move that direction.

[castlemagicmemories]

Free Returns can have dire consequences, as you know.  They won't work for everyone's business.  Even if you rarely have returns, that could change when and if you go to Free Returns, so evaluation is key before it becomes a financial drain.  It is supposed to work for you, not against you.

Good Luck.

[sugarnspice777]

Then after you get all the scammers using FREE RETURNS ebay tells you that your losing your TRS because of all the returns.

Just leave the 10% behind with the free returns off your listings.  We cant win here.  We need them, they don't need us, that is there motto now.

[18704d]

"Free returns gave people the initiative to returns things because they changed their mind, because of buyer's remorse, or simply because it's end of the month, they ran out of money and easy solution is to return what they bought."

------------

Free returns also gives good buyers the confidence to buy from you.

This means sales you wouldn't have gotten without offer FR.

The vast majority of eCommerce buyers expect FR and seek it out.

They also say it's a major factor in who they will purchase from.

As said earlier, all sellers need to evaluate this themselves.

FR is supposed to Gain sellers more $$$ than they lose.

If excessive returns is occuring for some, it's time to evaluate why.

It's not always the policy at fault.

Thanks,

Lynn

[accessoriesetcplus]

I will no longer offer free returns in the category I sell in. I tried it for a couple of months and it is to costly. I sell women's accessories. I think they order it just to see if they might like it. Knowing that they can return it and cost them nothing.  They think it might fit , even if the true measurements are posted. Had one buyer order gloves that were stated wrist length, she thought they might be longer. Had a belt return for fit, when it is clearly stated smallest to largest inches it would fit. When it is offered as free returns they are window shopping at sellers cost.

[escuintla]

I have repeatedly said it here. We can't adopt the "Macy's changing room mentality" the buyers feel entitled to show us when using Ebay. 

[autopartspuller]

---

@pauls-parts wrote:

"This ignitor did not fix my problem. I will be sending it back. I see you have a ballast that might work. I want to try that one since the shipping is free and I already paid for the part."

When I was offering free returns. I actually got this text from a customer. With in the first month I had to stop the free returns or I would have been out of business. I am not a shoe store to just try things on.

---

Do you realize that Ebay Motors is exempt to the free returns in order to receive the TRS+ discount?

I also noticed you do still have some free returns.

Used Auto Parts (or auto parts in general) are near impossible to offer free returns and stay profitable.  Many people do the "lets give this a try" method to fixing a car.  In all honesty it is almost the nature.  Somethings can be easily diagnosed.  Others could be a myriad of issues/solutions.  I am extremely happy and appriciative that Ebay has acknowledged this.  Specially since, outside of ebay, a used part is not returnable by nature.  However, I have found that 30 days paid returns allows for people to be honest with their purchases (if it's just the wrong part or they realize they dont need it) without putting excessive burden on the seller.  If Ebay were to change their minds and start to require free returns to receive the extra discount, I would likely just continue to offer 30 day paid returns and be less flexible in my pricing.

[ancientcoins.market]

Update !

We did an extensive data analytics study about our business performance.

With "Free Returns" Return rate went from 0.2% to 39.11 % hike.

Free returns indeed brought new customers, however the wrong type of new customers ( Fraudsters, freeloaders,  etc..)

Officially our company is dropping out  free returns.

[ancientcoins.market]

@Lynn

Every business is different.
Our conclusion is based on our business model and deep data analytics. 
Indeed we had more buyers,  more sales, even more returns and huge expenses in returns shipping labels/ insurance, Depreciation , empty packages etc.

These costs just tipped the balance toward negative , big time.  Not to mention cash flow is frozen in returns, you can't bring new inventory, you have to spend hours on phone with ebay, Negative impact at Paypal, and much more.

Best

ACM Team

[mam98031]

---

@sugarnspice777 wrote:

Then after you get all the scammers using FREE RETURNS ebay tells you that your losing your TRS because of all the returns.

Just leave the 10% behind with the free returns off your listings.  We cant win here.  We need them, they don't need us, that is there motto now.

---

Not unless you are not dealing with the claims and your buyers are having to escalate all of them so Ebay decided.  That is the only way they become a defect.

So just make sure that you handle the situation and don't give the buyer a reason to escalate the claim.  Then your TRS standing will be fine in regards to the number of claims you may have filed on your account.

Now it does affect you in the Service Metrics.  The mere fact a SNAD is opened is counted in the Service Metrics, no matter the outcome.  But the Service Metrics does not affect your TRS standing.  It affects other things that are potentially lethal for a seller.

[mam98031]

---

@ancientcoins.market wrote:

Update !

We did an extensive data analytics study about our business performance.

With "Free Returns" Return rate went from 0.2% to 39.11 % hike.

Free returns indeed brought new customers, however the wrong type of new customers ( Fraudsters, freeloaders,  etc..)

Officially our company is dropping out  free returns.

---

The stop offering it.  Unless it is still cost effective for you to offer Free Returns, I'm unsure as to why you do.