Sharon Greenwald thought she had packed the piece of Lladro porcelain securely, so it was an unhappy surprise when she got an e-mail from the buyer saying that the piece had arrived with the head broken off. It was then that the 41-year-old owner of Luxurywares (eBay User ID: luxurywares) in Briarcliff Manor, New York, which sells mostly clothing and collectibles, made some changes to her shipping practices.

Understanding proper shipping procedures can make or break an eBay seller's success, explains Paul Purdue, president of iFulfill.com, a shipping and fulfillment center in Maumee, Ohio. Without proper knowledge of shipping and packaging options, he says, eBay sellers risk wasting money and damaging their customer relations. Among the most important shipping tips to remember:

  • Make it drop-proof. "A package should be able to be dropped from five feet," explains Purdue. "'Fragile' stickers don't mean anything. Writing 'This side up' doesn't mean anything. No attention is paid to them."

Instead, says Purdue, pick a sturdy box, and pack the item securely so there's no void between the box and the item, even if the item is not fragile. Double-boxing-placing a box inside of a box-can also provide additional protection against crushing, but it's important to be sure the interior box is packed securely inside the exterior box, leaving no gaps, Purdue says.

  • Ask the buyer. When Greenwald is unsure of how to pack delicate items, she asks the buyer, especially if that person is a collector. "Collectors are the nicest people, and they usually know more than I do about how to pack certain items," says Greenwald, who brings in approximately $3,000 per month on eBay.
  • Use packing materials properly. Gary Neubert, 52-year-old owner of Gatorpack (eBay User ID: gatorpack), a Tampa, Florida, purveyor of shipping supplies to eBay sellers and small businesses, says packing materials lose their effectiveness when not used properly. For instance, bubble wrap should be used with the bubbles facing toward the item, and packing peanuts should fill the entire space between the item and the carton, leaving no gaps. "When you don't pack the item properly, it's much more susceptible to being damaged," says Neubert, a Gold PowerSeller whose company takes 100 to 200 orders per day.
  • Choose the right courier. For packages weighing less than 4 pounds, Purdue recommends the U.S. Postal Service (USPS) as a good choice for shipping. Check into FedEx, UPS and the like for heavier packages. Each has different rates and benefits, such as tracking capabilities, so choose the one that suits your needs and provides the best value.
  • Insure. Insurance, which is offered by FedEx, UPS, the USPS and other courier services, is a good idea for expensive items, but make sure you know the requirements for cashing in-and abide by them. Says Purdue, "Even if you have insurance, if someone didn't sign for the package, the insurance may not pay for the item."

Returns and Refunds

While some ebay sellers are careful to state "As is, no returns" on each of their listings, other sellers find that offering refunds and taking returns are better courses of action for their businesses. Which is right? "Like many things pertaining to eBay transactions, it's up to the seller's discretion," says Greg Holden, author of How to Do Everything With Your eBay Business. Holden says sellers who are primarily concerned with maintaining a high level of customer service-and a high feedback rating-may wish to implement a refund or return policy. Those who sell only occasionally, or who sell items with unusually high profit margins, may want to be more stringent about refunds and returns.

Daryl O'Connell, 39-year-old founder of Anita's Joy Gift Shoppe (eBay user ID: anitasjoy) in Manasquan, New Jersey, sells her small antiques with an "As is, no exceptions" disclaimer. But that's not to say that she wouldn't make an exception.

"If someone was terribly unhappy, I'd consider making other arrangements," says O'Connell, who has yearly sales of approximately $100,000 for her gift shop and about $1,000 in monthly eBay sales. "But that's never happened yet. I use the [picture] pack, where you can put up to six photos for a dollar, and I make sure that if there's a nick or a scratch, I show it. I also give the dimensions of the piece. That's worked well for me."

Other sellers find that an open return policy works best. Matt Solar, founder of Yoozed.com (eBay user ID: urbanaddiction), which manages its own as well as consignment auctions, believes that his easy return policy instills confidence in his customers. The policy states that if Yoozed.com makes a mistake, they'll pay for the return, including shipping. Solar, 27, will work with customers who are unhappy with an item to resolve the situation, either by replacing the item with shipping charged to the buyer or by refunding money, less a restocking fee of 10 to 15 percent.

"Restocking fees make sure that people aren't just returning the item on a whim," says Solar, whose Boston business makes more than $1 million per year selling primarily home goods, consumer electronics and clothing on eBay.

Holden says that another key to good return policies is consistency. "Come up with boilerplate wording that is the same from [listing] to [listing]," he suggests. "It builds buyer trust."

How do you set a policy that's right for you? Holden suggests following these tips:

  • Ask yourself whether it's more important to encourage repeat business or make individual sales. "A no-return policy will not encourage repeat business; a more liberal policy will," he explains.
  • Set an appropriate time frame for returns. Usually a week or so after you receive delivery confirmation is appropriate.
  • If you must charge handling fees, be fair. "Deduct a few dollars-but don't gouge someone by taking out $10 or more," Holden says. He adds that it's fine to deduct any processing fees you may have incurred from your refunds.

Overall, says Holden, keep customer service at the front of your mind. "A few dollars isn't going to make a big difference in a year's worth of sales," he says. "If you are hoping to operate a part-time or full-time business on eBay, customer satisfaction, good feedback and return business will make a huge difference. Keeping the big picture in perspective and giving refunds when the customer won't be satisfied any other way can pay off in the long run."

 

Feedback 101

Jody Wilner's Sterling Silver Jewelry business, Beyond Expectations (eBay User ID: thejeweler1), had a sterling feedback history, with thousands of positive reviews. That changed when he and his partner, Glenn Unger, 42, moved the business and their families from Wantagh, New York, to Lutz, Florida. Out of touch for a few days, Beyond Expectations quickly racked up a batch of negative feedback comments, mostly for nonresponse.

"We lost a lot of e-mails. People couldn't get in touch with us. There was no way to post an explanation. It was the biggest batch of negatives we've ever had," Wilner recalls, adding that if he had it to do over again, they wouldn't have planned any listings for the period when they moved. "There's a lot of back-and-forth that has to go on when you have 200 [listings] a week. We should have stopped the [listings] and restarted when we were set up." Luckily, they moved past the situation-and now make about $14,000 per month selling on eBay.

Feedback is important to the eBay user, according to Joseph Sinclair, author of eBay the Smart Way: Selling, Buying and Profiting on the Web's #1 Auction Site: "If a buyer is purchasing an expensive item, maybe over $100, they'll definitely look at the feedback of the seller first. If it's not good, many people won't bother bidding."

Sinclair believes that a few good business practices can really safeguard your feedback rating. He offers these tips:

  • Avoid surprises. Use your listing description to disclose all relevant details about the item, especially if it's used or has any sort of defect. Photographs can be very helpful in showing features or damage. In addition, mention in your ad if there will be any sort of delay in shipping or communication-whether it's a policy of not shipping until payment is received, or using a lower-cost shipping method such as third-class or media mail, which could take several weeks to arrive.
  • Ship right. Ship your items securely to ensure that they arrive in good condition. Larger items, like the tractors and farm equipment sold by Allen Bishop and his wife, Jeanette, both 56, need other arrangements. The Bishops (eBay user ID: harley1983), who live in Chadwick, Missouri, make arrangements to transport each piece of equipment themselves, arranging a date with the buyer at the time of sale. Even though they've sold 26 tractors over the past year, they have no negative feedback to date.
  • Check buyer feedback. Just as buyers check your feedback, you can use buyers' feedback as insurance, says Sinclair. If you see that someone doesn't have feedback or has a string of negative feedback, be cautious. Be sure that you have payment for the item, and protect yourself by shipping it with insurance and requiring a signature guarantee.

If you do find yourself in a situation where you receive negative feedback, you may have an opportunity to work it out with the seller. eBay recently instituted the new Mutual Feedback Withdrawal policy, which allows members who mutually agree to withdraw their feedback to do so. While the rating, which can impact the member's score, is withdrawn, the text of the comment remains in the member profile; and member profiles include the total number of times a member has withdrawn feedback.

Protecting Your Payments

Something didn't seem right about the highest bidder on Chad Savage and Joseph Berger-Davis' latest listing. Their Los Angeles company, Play Angry (eBay User ID: squirmal), a startup with a projected revenue of $20,000 for fiscal year 2005, has a policy of not shipping its sportswear until payment is received. It had been weeks since this overseas customer had been in touch. Finally, after several months, the customer responded that the shipping charges were too high and that he wouldn't pay for the item.

"eBay has a reporting site, and they sent him a notice that they'd be keeping an eye on him for nonpayment," recalls Savage, 38. "He sent me an apology, and I let it go."

While the majority of online buyers are honest, nonpayment issues and conflicts still arise, says Donny Lowy, author of Secrets of eBay: Strategies and Tips Used by the Most Successful eBay Sellers. Protecting oneself, he says, requires setting good practices, developing good instincts, and keeping on top of the latest requirements of PayPal and credit card companies.

  • Start at the listing. Lowy says that having clear descriptions and photographs of items is a must. Invite prospective buyers to call with questions. If it's a low-cost item that he expects to sell in quantity, Lowy will offer a sample: "I do whatever I can to make sure that people know what I'm selling them upfront."
  • Check out suspicious customers. If Richard Hect, owner of Golden berry.com (eBay user ID: richardseller), a $1.25 million purveyor of Anglo-American foods, collectibles and gift baskets in Ridgefield, Connecticut, hasn't dealt with a customer before and notices an odd or unusually large order, he'll ask the buyer to call before processing the order. Hect is especially careful to do so if the individual doesn't have a strong feedback history. "We've had trouble with overseas buyers not paying," says the 37-year-old entrepreneur. "With eBay, you have the added issue of feedback, which does do a lot to keep people better behaved. But at the end of the day, you have to decide whether this is a person you trust or do not trust."
  • Get paid the right way. Know what PayPal or credit card companies require to help protect you from fraudulent charge-backs for non-receipt of merchandise. "PayPal offers protection to the seller if the item is going to the same address where the credit card bill is sent, but you still have to have confirmation of delivery. Some credit cards require the CVV2 [identification digits on the credit card] to be included in the payment process," says Lowy. "It's all in the name of trying to combat fraud, but it puts a big burden on sellers."
  • Ship promptly and properly. Items should be shipped as soon as possible after payment is received. Any delays in shipping should be disclosed, and expensive items should be insured. "But remember that you're only compensated [by the insurer] for the cost of the item," says Lowy. "If you got a great find at the flea market but didn't get a receipt, you may not be reimbursed."
  • Deal with problems immediately. If a customer expresses dissatisfaction, work quickly to address the problem. "Sometimes, people just want to be reassured," says Lowy. "And sometimes, they have a complaint. On a $100 order, I may say, 'Will you be happy if I send out [another] $15 worth of merchandise and you pay for shipping?' That will usually work to salvage the relationship."

If a problem does arise, try to contact the buyer directly to work it out. Those who can't work out their disputes can also turn to SquareTrade, a fee-based third-party arbitration system. SquareTrade acts as a mediator in situations where negative feedback has been given and will help resolve conflicts, often resulting in negative feedback being removed.


GWEN MORAN is a writer and consultant specializing in marketing.