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Mon July 3 2017 21:02:59

eBay Incorrectly Refunds Buyers for Handling Fees

By: Reader

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Dear Ina,
I just read your article dated May 25th about eBay refunding a buyer's handling fee on a return (link). I have been a longtime seller on eBay since prior to 2000 and make a living selling on there, I know their system very well. I deal with them daily and have been witness to all the changes they have implemented to hurt sellers, open up sellers to return fraud, and ultimately cost sellers more. 

Just recently I experienced this new handling fee refund issue. I sell alot of larger items with calculated shipping. When using calculated shipping we always add a few dollars hidden handling fee in the "handling fee" box on the eBay listing in the calculated shipping section when setting up the listing. We charge the handling fee to cover the box, tape, labels, and packing material. 

I recently had a buyer purchase a $144 item and pay $29 shipping. In that $29 shipping was a $3 hidden handling fee, the $3 fee is hidden from the buyer as it was put in the handling fee box when setting up the ad. 

The buyer opened a return for the item as he purchased the wrong thing. This was not an item not as described claim, just a simple no seller fault return in which the buyer has to pay return shipping. 

I approved the return and then noticed on the return details page on eBay it said item price $144 estimated refund $147. 

I called in to eBay and asked what was going on. The rep came back on and said it's the handling fee. I questioned is $147 the amount I have to refund and she said well yes it's the item price plus handling fee. I said the buyer had no idea about the $3, it was hidden - if I refunded $147 when they paid $144, it would just confuse the buyer. 

And why should the buyer get back more for returning an item than they paid for the item? 

I questioned who gets the extra $3 back the seller or eBay? She said she couldn't answer that. 

When you close out the return through eBay's return system and eBay refunds on behalf of you they issue the refund to the buyer and the seller never sees how much eBay actually refunded the buyer. It would be real easy for eBay to pocket the $3. 

If you bypass eBay and go to PayPal and refund just the item amount, then eBay will not refund any of the selling fees as they say they have no way of knowing the buyer was refunded. 

This is just another way for eBay to make money on returns, sell the shipping label through eBay inc. shipping to ship the item, then sell the buyer the return label through eBay returns to return the item, and then pocket the sellers hidden handling fee. 

I told her it's one of two things going on here, it's either a glitch in your system or you guys are now pocketing the hidden handling fees. 

I know from years of dealing with eBay they never do anything unless it makes them more money. I'd be willing to bet eBay is not refunding the buyer more than they paid, that would just expose the handling fee and confuse the buyer as the purchase and refund amount would be different, invoice and credit card amounts wouldn't match, etc. 

After reading your article I now know it's no fluke. They secretly made this change. They never did this in the past, my closed returns history on the site proves it. This is new. 

Has anyone confirmed if eBay is pocketing the handling fee, or is it really being refunded to the buyer? The buyer would have to tell you what amount showed up in their PayPal account when refunded.

Thanks,
(Anonymous)

Note: Numbers changed to protect the seller's identity.




Comments (10) | Permalink

Readers Comments

eBay Incorrectly Refunds Buyers for Handling Fees   eBay Incorrectly Refunds Buyers for Handling Fees

This user has validated their user name. by: eXtinctBay

Tue Jul 4 01:55:31 2017

???????

This issue came up recently on ECB.

If the buyer pays a certain amount of money to purchase and returns the item, their FULL PRICE PAID is refunded.

You can recoup your shipping costs and handling with a restocking fee. If there is not one posted on your listing, you will need to inform the buyer in a positive, professional manner that they will have to pay shipping both ways due to their remorse return.

This is done strictly through return request messaging, without officially accepting the return.

If you do accept the return request through eBay, a restock fee cannot be charged if not originally included.

This is why it is a good idea to include a restock fee on expensive items. Otherwise, you will have to refund through PayPal to subtract the costs. And you will not receive any final value fee refund if not issued through eBay.

Again, the refund will be initially based on the total purchase and shipping costs. If a handling charge was paid by the buyer, you will have to get it back with your restock fee.

And if a SNAD claim is filed, you will have to pay shipping both ways, including a refund of the full purchase price.

Cannot figure out how eBay would collect any handling fee when it has been refunded to the buyer.

eBay Incorrectly Refunds Buyers for Handling Fees   eBay Incorrectly Refunds Buyers for Handling Fees

This user has validated their user name. by: Marie

Tue Jul 4 03:01:02 2017

Boy I understand this issue so much better now than I did with the first time we discussed this a couple weeks ago.  Thank you for the well written, detailed description of the issue.

I have no idea why Ebay would do this, so I can't offer any explanation for it, sorry!

It would be limited to sellers using the calculated shipping program.  Otherwise Ebay would not be able to tell what the seller is charging for handling fees.  Just another reason to use stated shipping rates and avoid the calculated shipping program whenever possible.

eBay Incorrectly Refunds Buyers for Handling Fees   eBay Incorrectly Refunds Buyers for Handling Fees

This user has validated their user name. by: Ric

Tue Jul 4 07:33:23 2017

OP.... why not try to contact the buyer and ask them how much their refund totaled?

Their answer would tell you whether or not eBay is cheating both their buyers and their sellers if it turns out they are keeping the handling fee for themselves.

eBay Incorrectly Refunds Buyers for Handling Fees   eBay Incorrectly Refunds Buyers for Handling Fees

This user has validated their user name. by: iheartjacksparrow

Tue Jul 4 11:08:08 2017

OP - Have you tried adding your handling fee to the cost of the item? Or would bumping the price of your item make it too expensive? eBay would not know the amount of the handling fee if you don't actually separate it from the base cost.

Otherwise, I would suggest you follow Marie's advice and ditch the calculated shipping. Figure the highest cost it would be to ship your item to the farthest location, and if the destination is closer to you, refund the difference through PayPal.  

eBay Incorrectly Refunds Buyers for Handling Fees   eBay Incorrectly Refunds Buyers for Handling Fees

by: Truk This user has validated their user name.

Tue Jul 4 17:47:50 2017

Just another reminder what a unethical company eBay is

eBay Incorrectly Refunds Buyers for Handling Fees   eBay Incorrectly Refunds Buyers for Handling Fees

by: Just Plain Irritated This user has validated their user name.

Thu Jul 6 08:50:38 2017

I first posted about the handling fee issue on May 25.

You can verify WHO got the handling fee by going to PayPal where you can see the customer's refund.

eBay IS giving the handling fee to the buyer.

The buyer may be sending back the box, packing materials, paper and ink used, but generally only the packing peanuts and bubble wrap can be re-used. The boxes quite often are in very bad condition after two trips. And many times the box, packing peanuts or bubble wrap are so scented that we hesitate to send them to our next customer because many people are allergic to scented products.

This is eBay handing our costs to the customer, most of our returns are buyer remorse or failure to read a description and picking the wrong size. They pay the return fees, but get to keep what we charged them for the ruined packing materials we receive back.

eBay is about to loose another long time seller, since 1998. We used to sell between $9000 to $12,000 a month before they started meddling in what used to be a great place to buy and sell. Now we are lucky to clear $2000 a month. It's sad.......

eBay Incorrectly Refunds Buyers for Handling Fees   eBay Incorrectly Refunds Buyers for Handling Fees

This user has validated their user name. by: Marie

Thu Jul 6 12:59:46 2017

@just plain irritated

This isn't an answer and I firmly believe Ebay should not be doing this, but as a work around, don't use Calculated shipping if you can avoid it.

If you need to continue to use calculated shipping don't state a handling fee.  And your handling fee into the price of the product.

Not a perfect solution, but as long as Ebay is doing this, you can avoid it from happening again.

eBay Incorrectly Refunds Buyers for Handling Fees   eBay Incorrectly Refunds Buyers for Handling Fees

by: Just Plain Irritated This user has validated their user name.

Fri Jul 7 16:26:39 2017

Thanks for the suggestions Marie.

We did refund through PayPal on one return recently after reading you advice. Then we called eBay and they cancelled the return request since it was not our fault and we were not obligated to pay for their return shipping.

We have around 800 items listed on ebay, all pretty much unique from the other, so trying to estimate and not use calculated shipping would be a total nightmare when postal rates change.

I might be able to move some h/f into price, others it won't work as we compete with other sellers on some things where the price would look higher.

This is a constant learning process as eBay just keeps making things more difficult and costly for us sellers.

eBay Incorrectly Refunds Buyers for Handling Fees   eBay Incorrectly Refunds Buyers for Handling Fees

This user has validated their user name. by: Marie

Fri Jul 7 16:33:48 2017

@just plain irritated

I'm very glad I could help you, even just a little bit.

While I know some have experienced CSRs telling them that this is normal or something Ebay has chosen to do, but it isn't.  It is a glitch.  Ebay has not always done this.  It is just another glitch to add to the long list.  

OK on those that you can't increase your product pricing, instead of doing a separate handling charge in S&H, bring your actual shipping rate up a little bit.  Meaning if you have it at 4 Oz, take it to 5 Oz.  Or whatever it is that would just increase your shipping enough to cover your handling fee.  I'm not encouraging anyone to take advantage of their buyers.  I'm simply saying this could help you on some of the items you have listed.  Maybe not all, but a few more.

eBay Incorrectly Refunds Buyers for Handling Fees   eBay Incorrectly Refunds Buyers for Handling Fees

by: RedSqrl This user has validated their user name.

Mon Jul 10 01:31:54 2017

What's to stop you from just adding a pound or so in the calculated shipping estimate instead of the handling fee?  It will give you a little money to cover packaging, and ebay wont give it back to the seller in a situation such as this



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