Free Returns

[plumbingspecials]

I had a conversation with an eBay rep yesterday who called me to tell me (once again) about the free returns program, and how this wonderful program can boost sales by 15 percent, according to some data that was most likely manipulated to get people to believe that sales = profits.

I feel really bad because by the end of the conversation, she was trembling, perhaps even in tears, and that was certainly not my intention. The poor girl was just doing the job she was hired to do, reading a script that she was told to read, and to try to convince Top Rated Sellers that it's okay to be extorted by eBay. I hope she did not take my feedback about eBay personally, but I really think it was her first day. I explained to her that this move by eBay is opening a whole new channel for thieves. Now they can search by "free returns" so they can target sellers who offer this program. Thieves know they can get items for free or for at least 50% off. There is no way a seller can make a profit with this strategy. There is no honor among thieves, and if eBay truly believes members are always honest, they are sadly optimistic. As it is now, most returns are FALSE SNAD cases (in other words, the buyer LIES to avoid shipping and restocking fees), so let's just make it easier for them by removing the step where they have to lie to return something for free (yep, that will make them honest!). The rep excitedly tells me that if the item is returned in any other condition than we sent it, we are allowed to keep 50% of the sale and refund only 50% instead of having to refund the full transaction. After four reports of buyers misuing the free returns system, eBay will give them warning. So they get to rip off at least FOUR sellers before eBay shuts them down.  (Yep, again that's keeping them honest!)

I reiterated to the rep that eBay is cheating us out of our TRS benefits by forcing us to take losses on our sales. If we do not conform to this ridiculously unprofitable policy, we do not get our benefits on those listings. So, If I sell an item for $1000, the buyer requests a return and sends back a box of rocks, I get to keep 50% of the sale IF I CAN PROVE that I sent out the correct item. I do not get a discount on my final value fees because it's only a partial refund, but hey, at least eBay put our TRS badge on that item.

So to put this in perspective:

I have a unit that I paid 700 for (because I am adistributor).

I sell the unit for $1000. I pay shipping $25. Buyer requests return, I pay another 25 plus call tagf fee of 16, so it costs 41 to bring it back. I receive a box of rocks, the buyer keeps the unit, and I get to keep half of the refund because the buyer didn't send back the same unit.  Here's what it looks like:

1000-100 (fvf)=900

900-25 (shipping)=875

875-700(cost of unit)=175

At this point I made a profit of 175 (sounds good, right?)

Oh but wait. The buyer requests a return (no reason is needed).

175 (what I initially made) - 41 (return shipping and call tag)=134

Buyer ships back box of rocks instead of a unit that I can re-sell.

134-500(partial refund for scam buyer)= -366

This transaction would cost ME $366 to receive something back other than what i sold.. Not sure how eBay expects people to sell here if we are not profitting or at least breaking even. 

I suppose the rep who called me NEVER SOLD A THING ON eBay! Because not one person who ever has, would agree that this is a "good" program for sellers. I think she realized that after I schooled her.

I still feel really bad though, because she honestly thought she was promoting a good program. 

[partsgalore1]

I file a sales tax return in CA every 3 months and I can tell you...it is a complicated and time consuming ordeal. If I had to do that "times 49" I would literally jump off a bridge!
Perhaps online platforms would set something up to do this for us...but it certainly would take a lot of development and coordination with each state. What about people who run their own sites? Paying sales tax to 50 states could be monumentally complicated for them? That said...I'm not worried about the affect on sales since prices would increase equally for all consumers. I'm more worried about the hit to the overall economy already taking a hit due to the trade war Trumpty Dumpty has begun. Sales are already drying up for a lot of people... and no! it's not eBay's fault. I have been feeling that the economy is ready to fall for quite some time. A further tax of 6 to 8% on everything consumers buy online will be a hit that could send the economy into a tailspin?? We shall see....

[partsgalore1]

Why don't you try discounting the refund to make the buyer pay the costs? I've done that a few times and so far it's stuck. I simply say the buyer bought the wrong item and the discount is to cover shipping costs. So far, no complaints from any of the buyers. The few buyers who want you to pay for their mistakes can be blocked. I have found that those types of people are a very small percentage. So far, free returns has protected me against losses and has not increased my returns. I'm sticking with it for now....

[partsgalore1]

Very good!
I also sell parts. In my case.. I found that the majority of returns are from people who just don't read the description or take the time to measure or compare their original part. In most cases, they don't complain when they don't get the shipping costs refunded. I firmly believe these people must not be allowed to make an innocent seller pay for their mistake and the great majority of people will not do so. The ones who can't be bothered to read often never take the time to return items...even when they don't have to pay the return shipping cost. And those who do return the item... they often don't include the original box or the item has been opened and not repackaged in a sellable condition...sometime even returned dirty! .... all of which justify up to a 50% discount to cover our time and shipping losses. Of course... I will never offer free returns on items that are expensive to ship. If we are to actually make a profit... losses must be kept under control!

[auctionsrva]

Might not reduce SNADs.  My rationale was specifically tied to free returns.  I've had several buyers make bogus SNAD claims prior to the new policy.  In my opinion they did this to avoid the cost of filing the proper reason and paying return shipping + restocking fee.  I didn't dispute a couple of them that involved small dollar amounts and resold the items.  The new free return policy (if a seller opts in) takes the penalty out of remorse returns so why file as SNAD?  That was my thinking as to why it would reduce SNAD returns (from Ebay's perspective).  Anyway to soon to tell, hope everyone had a nice 4th of July holiday.

[sidemouse]

---

@auctionsrva wrote:

Might not reduce SNADs.  My rationale was specifically tied to free returns.  I've had several buyers make bogus SNAD claims prior to the new policy.  In my opinion they did this to avoid the cost of filing the proper reason and paying return shipping + restocking fee.  I didn't dispute a couple of them that involved small dollar amounts and resold the items.  The new free return policy (if a seller opts in) takes the penalty out of remorse returns so why file as SNAD?  That was my thinking as to why it would reduce SNAD returns (from Ebay's perspective).  Anyway to soon to tell, hope everyone had a nice 4th of July holiday.

---

The problem is that the buyer is asked to pick a reason...

So which does the buyer pick?

Does the buyer pick "does not fit" or does the buyer select "doesn't work / defective?"

Heck why not just pick any reason since it really doesn't matter, free is free.

So the real problem is we get no clear idea of how many returns are truly SNAD...

[partsgalore1]

Thankfully, dishonest people are a very small percentage of the buyers on eBay. If they lie to shift the blame for the return to the seller, we have the option of reducing the amount of the refund and also reporting them to eBay. Ebay will then monitor that person for chronic returns or seller complaints. If a buyer will not clean up their act, they will be removed from eBay (in theory). I'm not concerned with that anyway.. if a buyer loses money every time they make a mistake or change their mind.... guess what? They will be more careful and think their purchases through so they won't have so many returns. Our ability to reduce the return amount by as much as 50% is critical to reducing dishonest and incompetent buyer returns. RE: SNAD... always ask for a picture to show why they are making this claim.... often they will walk away since they know we are not going to just give their money back. If they do return the item and it is as described and they ignored a request for a picture.... I have found that eBay usually backs me up. I think eBay has finally realized that buyers with zero accountability is a breeding ground for monsters. Buyers must be responsible for their mistakes. Keep in mind, the term "free return" is as deceptive as "free shipping" both are designed to attract buyers but are not actually true. In my mind... the key to the "free return" program working is our ability to reduce the amount of the refund when the buyer is at fault. If eBay doesn't back us up in these cases, the monster buyers will come out of the woodwork again. If eBay doesn't find a way to protect both buyers and sellers from losses due to dishonesty and incompetence, then they will continue to have problems. I truly think the free returns program is a solution to the problems we have all experienced. I believe buyers will be forced to take responsibility for their mistakes and will be more careful as a result.

[finerdiamond]

It's my understanding that a reduced refund can only be used when the returned item is received in a condition other than original.  

Approximately 99% of the returned items I receive are still in original condition, so this change in policy will not help me.

[autotruckrv]

Ebay is forcing free returns down our throats. So now they say we can't charge a restocking fee that we used to recover the free shipping that Ebay has forced us into. So now the buyer can order an item with free shipping to them (that I have to pay for) they can look at the item, open it, get it dirty, change there mind for any reason or they didn't read listing with nothing to lose. I think the person that came up with this brilliant idea should be docked their pay anytime anybody doesn't like things they do or say or they just don't like how they look after you see them. Do you think they work for free. That is the same thing as the hassle free returns ebay is forcing down the sellers throats. See how they like money coming out of their pocket just because someone changed their mind or didn't read listing. If ebay wants hassle free returns they should pay for it or let us decide, if we want in or out, not forcing free returns down our throats. I'm not in business to lose money.

[autotruckrv]

I don't want any part of Ebay's hassle free returns. We are changing our listing to No Returns and probably removing free shipping it's figured into the price anyway, hope that works. I would rather pay higher fees than lose money because someone didn't read or changed there mind. As always if it is our mistake we will pay all costs that's only right. But if it's the buyer mistake why should I have to pay for there mistake that's only right.

[autotruckrv]

Ebay says the buyer is always right, and they can never do wrong. Ebay is only looking for more ways to make money. We are suppose to pay for free shipping and eat the free shipping when someone changed their mind or didn't read the listing. Us the sellers are suppose to just take it.

[partsgalore1]

That was true but they are changing their ways... read my previous posts, if you CYA you can prevent most losses and eBay will back you up. If that changes I'll be the first to scream bloody murder.

[partsgalore1]

I truly think you're making a mistake. Read all my posts in this thread before you go to no returns. I don't mean to be harsh...but I think you're "cutting off your nose to spite your face".
I do wish you the best of luck..

[partsgalore1]

this is all completely untrue... read my previous posts to understand why.

[partsgalore1]

You are 100% correct which is why the jury is still out on using the refund reduction to recover shipping costs. We can use this tool any way we see fit and give any honest justification for it. I think in the great majority of cases, buyers will accept our decision as long as its fair. If they made a mistake, why would any reasonable person think the seller should pay shipping costs? An unreasonable buyer would have to escalate the return claim in order to try to force us to pay the shipping (so far, none of my buyers have done so). Of course it will happen eventually and then we'll get a feel for how eBay is going to handle it. I have used the return discount several times to recover shipping costs when a buyer bought the wrong part.... and I have spelled this out in my reasoning. I will never accept paying for other peoples mistakes (I'm only willing to pay for my own!) If free returns start costing me money, I'll drop it like a hot potato... so far it looks very promising. Of course there are unreasonable buyers who think other people should pay for their mistakes and I will lose money when they cross my path... and I will block them. I do think those people are a very small percentage. Thankfully, those same people are often lazy and incompetent... in my experience, they often never return the item and the claim eventually falls off. When they do return the item, they don't package correctly, have missing parts, or missing packaging. From my experience....I really think the # of returns that end up with eBay stepping in and reversing our return discount decision will be very very low. Time will tell....

[sergei.lopatin]

I'm both a small-scale seller and a frequent buyer. Recently had an unpleasant experience as a buyer, when the seller refused to accept a return, despite indicating in their listing that they would with a discount. eBay stepped in an fully refunded the item, which I will be donating to Goodwill, as it is a wrong fit for me.

Here's my take on the situation.  eBay is simply trying to stay competitive, in a market where abundant new dollars creation, unleashed after the 2008 financial crisis, has ceased, as it proved to be unsustainable in the long term, because it started seriously threatening the status of dollar as the world's reserve currency.

In simple terms, the party is over: now the sellers have to compete tooth and nail for the buyers business. eBay is squeezed. On the new goods sales front, most severily by Amazon, which offers free and easy returns, while running very efficient system weeding out fraudulent buyers. On the used goods sales front, by Craigslist and other local marketplaces, which eliminate the expense of shipping and taxation, and the risk of buyer not getting what he believed he ordered. Internationally, they are cut off from the half of the world market by Alibaba and other marketplaces originating from China.

I think at some point in the past, eBay board of directors and/or executives made a strategic mistake, by enforcing very high transaction fees, calculated as a percentage of the price of goods sold. Only govenments have the power to enforce such an arrangement, which is called a taxation.

It would serve everyone better if eBay kept the fees in line with what it actually costs them to transact. But they felt they have a monopoly, and thus can start behaving like a government. The forces of free market proved them wrong. Now eBay is trying their darnest to adjust, so that they can stay in the game.