Elaine Pofeldt is a journalist whose articles on entrepreneurship and careers have appeared in Fortune, Working Mother, Money and many other publications. She is a former senior editor at Fortune Small Business magazine and an entrepreneur herself, as co-founder of 200kfreelancer.com, a website for independent professionals. She writes “Your Business Credit,” a weekly column about small business and credit, for CreditCards.com.
Dear Your Business Credit,
This week I received an email from a customer from my online business saying that the USPS tracking number on their order said “delivered,” but the package was nowhere to be found. I had obviously shipped and fulfilled the order to the best of my abilities, but the customer is demanding I either reship it or refund the money. There is documentation saying that USPS has given the customer the package, so I don’t think I should have any responsibility at this point. And if I do what this customer asks, what’s from stopping them from saying a package disappeared every time they order something in the future? The customer is threatening to file a credit dispute. Do they have a case I should be scared of, or should I stand my ground? – Sierra
There are two possibilities here: One is that the package truly was lost and another is that the customer is trying to trick you. Unfortunately, neither one is easy to resolve, but there are some ways you can protect your interests.
Susanna Walsh, head of customer support at Shippo, a site that allows users to compare carriers’ rates, suggested letting the buyer know that you will be filing a report with the U.S. Postal Inspection Service, and he or she may be called upon to provide additional information to the postal inspectors. Go to the service’s “File a complaint” page to start.
“The USPS takes allegations of missing packages extremely seriously,” Walsh said in an email. “Mail theft is a felony offense, and the USPS has the U.S. Postal Inspection Service to investigate all forms of mail fraud.”
There’s an added advantage to asking for a postal inspection, she notes. “This typically quickly separates legitimate cases of packages that go missing from anyone trying to take advantage of the seller,” she said in her email.
So what happens if the USPS confirms the product was delivered to your customer’s address but without a signature? Then you’re either dealing with a customer trying to commit fraud or a package that got stolen.
If you look at the situation purely from a business angle, it may be easier to refund the buyer and write off the loss as a customer service expense, Walsh pointed out. For one thing, if you sold your wares through a third-party marketplace such as Amazon or eBay, the marketplace’s customer service rules could limit the way you handle the situation.
Even if you sold the product through your own site, however, several merchants pointed out to me that refusing to refund the customer’s money could work against you by creating ill will toward your business. If the package was stolen, your patron is going to be very unhappy if you balk at issuing a refund.
I agree. I once ordered a desk that the merchant said was delivered, but it never came. When the merchant traced the shipment, the shipper was able to say the package was delivered in the city where I lived at the time, but could not verify the exact delivery address. I wondered why the merchant had not required a signature, given that it was fairly expensive item and the city had a fairly high crime rate. When the merchant resisted issuing a refund and then tried to insist on passing along a $35 restocking fee, I complained to the credit card issuer – which investigated and decided in my favor. I could see no reason why I should pay it, given that the merchant had taken a risk on shipping the item without a signature and then tried to pass that cost along to me. I would never buy anything from that merchant again.
If you are operating your own e-commerce site where you can set the rules, I’d suggest taking a cue from John Monarch, CEO of Direct Outbound, an ecommerce outsourcing company in Greenville, South Carolina. He suggests shipping a new item to the customer, but requiring a signature confirmation when you do – as well as a signature confirmation for any additional orders from the same customer.
“If you receive a chargeback despite having shipped additional product with signature confirmation, get together all records of contact between your customer service and the customer, as well as all tracking information,” he said in an email. “Sending the bank screenshots of delivery and signature confirmation, your terms and conditions, as well as all contact and offers of reshipment, will help stack the deck in your favor. It’s not a sure thing you will win ever, but every piece of information you provide helps your case.”
See related:Merchants hit by chargebacks look to hire help
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