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How do you handle shipping fees on returns/exchanges?
olimits7




msg:3841772
 4:35 am on Feb 4, 2009 (gmt 0)

Hi,

I'm trying to fine tune my returns policy, and I'm wondering how do you handle "shipping fees" that a customer needs to pay to send the product back to the website?

Does the customer pay the shipping fees to ship the product back to the website or do you provide a pre-paid shipping label?

Thank you,

olimits7

 

JohnRoy




msg:3841775
 4:39 am on Feb 4, 2009 (gmt 0)

If the return is due to your error, you pay.

If it's due to their error, it's their responsibility to ship back.
The refund too is total minus shipping.

olimits7




msg:3841798
 5:34 am on Feb 4, 2009 (gmt 0)

Ok, yes I was thinking of setting it up that way.

So if we ship the wrong item by mistake; we will pay. But if the customer says they just don't want it anymore; they will pay.

How about if a product turns out to be defective?

olimits7

KevinC




msg:3841824
 6:20 am on Feb 4, 2009 (gmt 0)

So if we ship the wrong item by mistake; we will pay. But if the customer says they just don't want it anymore; they will pay.

the above is what I would suggest. But there are some companies that advertise that they pay all shipping charges on returns. I'm not sure about that strategy though.

jsinger




msg:3841840
 6:52 am on Feb 4, 2009 (gmt 0)

But there are some companies that advertise that they pay all shipping charges on returns.

We had one competitor who advertised that they did that ...until they filed bankruptcy a few years ago.

MrHard




msg:3841846
 7:05 am on Feb 4, 2009 (gmt 0)

This works great if everyone is honest. Unfortunately, in the real world I have found that most people will say something is defective or what they have to say in order to lose less money and avoid any restocking or shipping fees.

The big boys offer free shipping, free return shipping, and free exchanges, but they have bigger pockets too. It's not a level playing field.

olimits7




msg:3842149
 3:08 pm on Feb 4, 2009 (gmt 0)

So on defective products it would probably be best if the customer pays for shipping to return the product to the website?

But then should I charge them shipping when I ship out the new non-defective product back to them?

olimits7

jsinger




msg:3842168
 3:21 pm on Feb 4, 2009 (gmt 0)

Our customers are quite honest, at least they were in better economic times. We send a UPS pickup to retrieve defective stuff at no cost to them

The big boys offer free shipping, free return shipping, and free exchanges, but they have bigger pockets too. It's not a level playing field.

It seems "give-the-customer-anything-they-want" Zappos is running into tougher times. Interesting company to watch.

Shimrit




msg:3842179
 3:28 pm on Feb 4, 2009 (gmt 0)

I guess the free shipping no matter what policy is based on the theory that people might be more likely to order in the first place if they think there's less risk involved. The question is, does it work?

p5gal5




msg:3842205
 3:57 pm on Feb 4, 2009 (gmt 0)

I wonder how much of zappos pain is being caused by endless, though. Zappos may have "loyal" users, but endless/amazon's vertical interface (imo) equates to a perception of better customer service. Looks like they're currently testing something to remedy this problem.

I agree with JohnRoy re shipping fees - our problem, pay for return shipping. Their error, they pay, and refund is minus original shipping charges.

It also tends to depend on the customer, though - if someone is a big enough PITA, we will just refund the whole thing to make them go away, even if it was their error. Time/800#/stress is money, too; this approach is quite common in larger companies with secondary/escalation protocols.

ssgumby




msg:3842312
 6:21 pm on Feb 4, 2009 (gmt 0)

Why do you think zappos has fallen on hard times? Not saying they havent, but ive been reading about them and got the impression they were doing quite well.

jsinger




msg:3842451
 8:49 pm on Feb 4, 2009 (gmt 0)

I was looking at a very few Zappos products last night and they seemed pretty costly, aside from the free this and free that. Anyone have opinions on that?

To me, their site is a mess. And they've added a lot more than shoes lately. Clutter.

I haven't read that they've "fallen on hard times" just that they've laid off some workers. Zappos said, as I recall, that they hired too many a year ago based on projections that were too high.

They certainly made themselves a target; Amazon's Endless shoe website is one more site to take aim.

gpilling




msg:3843768
 2:34 pm on Feb 6, 2009 (gmt 0)

Does anyone have data on what percentage of sales Zappos gets returned?

JohnRoy




msg:3843902
 4:53 pm on Feb 6, 2009 (gmt 0)

I guess the free shipping no matter what policy is based on the theory that people might be more likely to order in the first place if they think there's less risk involved. The question is, does it work?

In some industries it's a must, and it works.
in others it would put you out of business.
There's no one solution.

Try and test all types, until you get the results for your specific subject.

jsinger




msg:3843959
 5:42 pm on Feb 6, 2009 (gmt 0)

Endless: "Free Overnight Shipping - Free Return Shipping - 365 Day Returns - 100% Price Guarantee"

When I looked about a year ago they had a limited selection of brands. Their selection now is enormous. However, they don't carry Dockers, the brand I bought most recently. So I couldn't compare prices.

jsinger




msg:3843996
 6:30 pm on Feb 6, 2009 (gmt 0)

US Banks: "5% Down - No Credit Check - Walk Away Allowed - 100% Price Guarantee (houses only go up, don't you know)"

Hard to blame (or jail) a few bankers for all our problems when you find "banker" thinking everywhere you look.

gpilling




msg:3846597
 7:28 pm on Feb 10, 2009 (gmt 0)

To answer my own question about Zappos return rates, according to NPR the return rate is 25% - three times greater than regular shoe stores.

HugeNerd




msg:3846665
 9:04 pm on Feb 10, 2009 (gmt 0)

according to NPR the return rate is 25%

That really makes me wonder what sort of deal they get on shipping. If I paid for all return shipping and had a 25% return rate I would only sell items small enough to fit in a envelope and charge everyone $0.84 for freight...until the cost of stamps rose.

jsinger




msg:3846984
 5:10 am on Feb 11, 2009 (gmt 0)

"according to NPR the return rate is 25%"

Yes, I see where their site says that. Plus, imagine the work involved processing all those returns and exchanges... backbreaking. They risk becoming a magnet for people who love to return products. I can recall returning one pair of shoes in my lifetime and it was horribly defective.

I heard years ago that department stores averaged about a 15% return rate on shoes. Zappos is also probably getting huge concessions from suppliers. I've heard of dept stores charging suppliers a fee for defective shoes they have to take back.

gpilling




msg:3847231
 2:32 pm on Feb 11, 2009 (gmt 0)

Zappos sells $1 billion worth of shoes per year - and gets $250,000,000.00 in returns. I wonder if the returns are feeding the shoe market on eBay.

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