Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Mon Aug 12 2019 20:10:29

eBay Sends Drop Ship Violation Notices

By: Ina Steiner

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Some sellers who do not drop ship as a product-sourcing strategy say eBay sent them a notice that they are violating its drop-ship policy and will lose their Top Rated Selling status. One seller reported the issue on the Ecommerce EKG board and wondered if it was a technical issue.

eBay allows sellers to drop ship from wholesale suppliers, but not from retailers. Here's what eBay's help page says about drop-shipping:

"Drop shipping, where you fulfill orders directly from a wholesale supplier, is allowed on eBay. Remember though, if you use drop shipping, you're still responsible for the safe delivery of the item within the time frame you stated in your listing, and the buyer's overall satisfaction with their purchase.

"However, listing an item on eBay and then purchasing the item from another retailer or marketplace that ships directly to your customer is not allowed on eBay. In such cases, we may remove your listings from search, display them lower in search results, or remove them completely from the site. We may also limit, restrict or suspend your ability to buy, sell, or use site features on eBay, and you could lose any special status and/or discounts associated with your account."

Another seller recently forwarded us a copy of the email eBay had sent them (the seller didn't have TRS status). Here's a copy of the notification from eBay:

Subject: Your Top Rated Seller status will be removed: Selling practices - drop shipping
policy

Your Top Rated Seller status will be removed: Selling practices - drop shipping policy

Hello,
We've determined that you haven't followed our selling practices - drop shipping policy therefore, we will be removing your Top Rated Seller status until your account is in compliance with the policy.

There is evidence on your account that you are purchasing items from an online retail or marketplace site after you sell the item on eBay and having that retailer ship the item directly to the customer. This is a violation of the terms and conditions section of our Selling practices policy, which states:

·Items you list must be in your inventory or you must have an existing agreement with a third party to fulfill the delivery of the item under the terms of your listing.

For more information on this policy, please go to:



Regards,
The eBay team

Sellers had reported getting such notices in January. 

In April's Spring Seller Update, eBay warned that sellers who used a retailer to ship directly to buyers would face reduced search visibility. As we noted at the time, the policy appeared to be an attempt to reduce incidents where buyers receive their eBay orders in Amazon packages (or Walmart and other retailers' branded boxes), which can lead to confusion and/or disappointment on the part of eBay buyers.

Comments (53) | Leave Comment | Permalink
Readers Comments

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

This user has validated their user name. by: toolguy

Mon Aug 12 22:51:51 2019

Are eBay sellers allowed to use FBA if they have the item for sale on both sites?

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: P.Dorf This user has validated their user name.

Tue Aug 13 04:55:54 2019

Superb AI from the world's greatest tech firm [/s]

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

This user has validated their user name. by: The End

Tue Aug 13 05:14:42 2019

Somebody has to tell these "Venues" to F Off.
Mission Creep.......

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: UB This user has validated their user name.

Tue Aug 13 08:14:44 2019

Last November, we started to see a huge decrease in sales. We investigated and saw all our listings were buried to the bottom of searches. We called Ebay over and over to eventually find out they labeled us as a drop shipper even though we aren't. A cross promoted program that lists on multiple places that we tried only for 2 days was the issue. It took over 3 months to get them to remove this "violation" from our account which had resulted in over $20,000 lost in average sales for that period. Lets just say I was not pleasant on the phone with Ebay for a number of reasons including the fact that we have only used Ebay labels to ship our products. We have mostly now been concentrating on our Amazon store and reducing what we have on Ebay.  

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: leathermermaid8 This user has validated their user name.

Tue Aug 13 09:53:09 2019

I wonder if this isn't partly due to chronic complaints by buyers about receiving goods direct from Amazon.  There were many threads on the subject on the boards.

Most do not understand how FBA works; Amazon is warehousing and doing the grunt work of mailing them their stuff, nothing more.  There also seems to be confusion about whether or not arbitrage is allowed vs. dropshipping and what the difference is.

A lot of people who don't know the difference between FBA and how an Amazon Prime account works, either.  Basically, if there's a gift card enclosed,  most likely a Prime membership was used to fulfill the purchase which is NOT okay by Amazon but eBay doesn't care.  A FVF is a FVF.








Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: purpleiris This user has validated their user name.
Web Site

Tue Aug 13 10:40:52 2019

I really don't understand the problem with an item arriving in an Amazon box. There are many sellers who use recycled boxes to ship items, so they can come in all kinds of boxes. I used to, but only do it for large packages now.

As a customer, I've never had a problem with what brand name was on the box. My only concern is that it's packaged well.

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: pace306 This user has validated their user name.

Tue Aug 13 11:50:40 2019

While eBay may not like it - theres no legal (or even moral) reason that a seller cant source goods where ever they want.

As usual, eBays criminal crack lawyers invent their own rules/laws to suit themselves.

eBay just doesnt like stuff comming in other boxes/packaging and thats just too bad.

eBay bets that no small seller has the cajones to sue them.

As for the mistake(s) here - its eBay - the worlds dumbest ecommerce co - mistakes are their game!

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

This user has validated their user name. by: toolguy

Tue Aug 13 12:00:37 2019

@pace306

"As usual, eBays criminal crack lawyers invent their own rules/laws to suit themselves."

This holds true in all walks of life, welcome to the real world. . . .Don't you make rules in your house?

When on the eBay website you are in THEIR house, not yours!

They make the rules, YOU do not. . . .

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

This user has validated their user name. by: toolguy

Tue Aug 13 12:01:29 2019

"eBay bets that no small seller has the cajones to sue them."

OK, small seller, what are you waiting for?

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: pace306 This user has validated their user name.

Tue Aug 13 13:44:12 2019

Without getting into an argument ...

"When on the eBay website you are in THEIR house, not yours!"

Just because you run a business, DOESNT mean you get to make up any rule you want and say "its my place therefore its LAW".

As a citizen of CA (unless eBay isnt a CA corp) they are beholden to US (country) and CA (State) laws.

You can TRY and make up stuff - but just because you say it - doesnt make it so.

In this case (since you are unfamiliar) its called restraint of free trade. "an act, fact, or means of curbing the free flow of commerce or trade". eBay can charge you for listing, they can charge you a FVF, but what they cant do is tell you where to get things from or what boxes to ship things in.

It also boarders on " Tortious Interference" but thats not being discussed here atm.

Its kind of important that when "you" make a statement - you have some kind of back up. In this case - your blind love for eBay gets in the way of what reality is. Just because you are a big company and you havent YET gotten into trouble, doesnt mean that everything you do is legal.

As for "OK, small seller, what are you waiting for?" DUH - the cost to sue them is OBVIOUSLY not worth what you would get out of it. Would you put alot of money in a junk car? No you wouldnt since its not worth it. Same thing here - no small seller is going to spend MILLIONS to sue them (regardless of how corrupt they are). (Why do you think eBay "disallowed" class action lawsuits??? Answer: because thats the ONLY way smaller sellers could get "court time" without it costing them everything they own and then some. Together - with everyones money pooled together - you could feasibly sue them, alone ... forget it. And eBay knows it.

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: ElectronixRecyclers This user has validated their user name.

Tue Aug 13 13:54:49 2019

How does eBay ''disallow'' class action?  A judge either approves or disapproves a class - eBay doesn't get a say in it.

Bringing legal action isn't some magical process.  People seem to think you have to have some huge pile of money.  If you want to sue eBay, all you need is an actionable cause, standing before the court, and the court needs to have jurisdiction over eBay.  Generally, you have to sue the respondent in their jurisdiction.

There are lawyers out there who would take a case against eBay on spec.

Having said all that, I don't see anything actionable in eBay limiting a seller in their search results.  One of the problems with doing business with eBay or Amazon, or really any online marketplace is that the bulk of it does come down to ''their house, their rules.''  You're not going to prevail on a restraint of trade suit, because eBay doesn't have any obligation to do business with you at all.  Restraint of trade is if eBay says, ''We'll bury your search results (or outright kick you off the site) if we find out you're doing business on Amazon.''

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

This user has validated their user name. by: NoMoreEbay

Tue Aug 13 14:23:12 2019

Indeed, anyone can file a class action. Only a judge can approve a case moving forward. Even then, depending on the circumstances, it can be moved to Federal court which is a very difficult win. In any case, as you said, ebay has no say whatsoever.

I would have thought a class-action would have been filed for the 50% penalty fee. That is the literal definition of extortion.

ebay adding Best Offer to listings could fall under Tortuous Interference as it devalues the item and could thereby reduce sales and profits. But I'm no lawyer and have no idea really.

But hey, we have thousands of AA mechanics in a planned slowdown and the judge ruled in favor of AA. Big business fuels politicians, judges, the economy and everyone else in their pocket. It's the American way and a darn shame.

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: pace306 This user has validated their user name.

Tue Aug 13 15:03:03 2019

"How does eBay ''disallow'' class action? A judge either approves or disapproves a class - eBay doesn't get a say in it."

Generally - yes - you are %100 correct ... in this case however .....

Its in the TOS. You "agree" by the mere fact of logging in, to ANYTHING thats in the TOS. Thats why eBay rarely states changes (there are some changes that they make to it by law that they MUST disclose) it makes. To get by this it does post "all" of its changes by posting announcements on either its website somewhere Or on Facebook. In the TOS it says you agree by logging in that you will NOT sue them that way.

Whether or not that reason has any legal validity - you would have to get a lawyer to answer - eBays belief is that its TOS is a software and that you agree to its terms wholesale and it cant be changed or amended without their explicit agreement.

Its not (in either case - class action or single) that they cant happen - its how much money it would cost you. By yourself - by the time eBay gets the trial going it could be months - they would tie you up for years and any gain you would get would be worthless.

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: Silver Ice King This user has validated their user name.

Tue Aug 13 15:09:29 2019

@pace

Ebay as most companies seem to do, is incorporated in the State of Delaware.  

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: Will This user has validated their user name.

Tue Aug 13 15:46:07 2019

eBay doesn't like it, because the last thing the buyer sees prior to use of the item, is Amazon, since the items come in an Amazon box. And people are "so busy" these days, they order online from multiple retailers, they can't remember where they order from. But if they are satisfied with their item(s), and it arrived in an Amazon box, that could very well plant the seed that the satisfaction was from Amazon, not eBay. However, it could also go the other way around via manual fulfillment on Amazon and using an eBay seller. But see, eBay is always portraying itself as the victim, it seems.

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: pace306 This user has validated their user name.

Tue Aug 13 16:45:29 2019

Silver - I never checked - but Id assume you are %100 correct - for tax liabilities and shelters - Delaware is where its at.

Will said "But see, eBay is always portraying itself as the victim, it seems." and he too is correct - and funny :)

One might think that eBay should be happy enough to make any sales these days - but its ALWAYS good to find something to needle sellers about. It seems that blaming sellers for stuff is the one and only good/consistant thing ebay can do.

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: comments This user has validated their user name.

Tue Aug 13 18:36:25 2019

This is the greatest update for the assurance of buyer satisfaction since the introduction of feedback.

There is NOTHING more infuriating then having someone use your name to buy your item on amazon/walmart/homedepot/sams club. Then when they send the wrong product you have to return it to the retailer. Worse when you buy an item and it is out of stock on amazon they cancel the order.

This drop shipping crap has made me have to check all retailers before I buy from ebay to ensure I am not going to get drop ship screwed.

Many of these sellers are also charging fraudulent sales tax to cover the sales tax they will be charged instead of remitting it to local governments as they should be.

Can't thank ebay enough for this one!!!!!!!!

Now all they have to do is clean up electronics sections from used products listed as "open box" and refurbished crap listed as "new"

Then combat sales tax fraud where sellers are charging sales tax for additional profit when there is no facilitator law and no other nexus.

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: Silver Ice King This user has validated their user name.

Tue Aug 13 22:26:34 2019

@comments

Kind of hard for Ebay to crack down on the Sales Tax Fraud when one of the largest offenders is their Partner..... China!!!  Ebay has no intentions of cracking down on any Chinese Sellers as Wenig still believes that China is Ebays future and he is doing that he can to make that a self fulfilling prophecy.  China has so many different rules than we have including that Ebay cannot track IP Addresses so if and when Ebay ever shuts down a Chinese Seller they are easily back up the next day with a new Screen Name which also just happens to have nice feedback already attached to it.

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: mjr55 This user has validated their user name.

Wed Aug 14 00:35:23 2019

@toolguy in your first post....

Not sure Ebay's stance on this but Amazon makes it VERY clear you are not to use FBA to drop ship anywhere. It's suspension time if they catch you and there are a couple threads per day of sellers being suspended for this on there.

I don't see an issue with this ban.

Perminate Link for eBay Sends Drop Ship Violation Notices   eBay Sends Drop Ship Violation Notices

by: wh This user has validated their user name.

Wed Aug 14 00:52:12 2019

@comments

You are so far off base. Dropshipping is an issue but it is the way that eBay is handling this that is so messed up. PLEASE READ.

I don't dropship, even from FBA. I almost never even reuse Amazon boxes for eBay just because that feels like bad business. In my case, every single eBay order is shipped using their buy shipping system. They all start from the same location--my registered address.

But because I use software to duplicate my Amazon listings on eBay, they have targeted me repeatedly without anyone human doing any manual checking or providing me with an appeal process or even way of contacting that team directly.

It has cost me a ton of money with increased shipping charges, less insurance on postal items and impacted my sales greatly.

Again, I do not dropship, even from my own FBA inventory. I do not reuse Amazon boxes. I ship everything via eBay's shipping service and everything originates from right here (a tiny little town).

eBay has let bots/ai find drop shippers and had zero humans verify the result or given me a way to reach them. If you, or anyone else, thinks that is fair and good business than wait till it happens to you.

Right now the only way to undo this would be to recreate 1,000+ listings by hand.

And no none of my stats are poor. I was always TRS before this ordeal. If anyone has a way of contacting the people that could fix this without getting on the phone for hours, please let me know.  

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