The “Item Not Received” scenario occurs when the buyer claims they never received the goods. They either request a refund or the seller will send a replacement item.
The benefit of fraud for the buyer is that they get the goods and their money back (i.e. they’ve got the item for free), or they get two items for the price of one.
We must acknowledge that the honest buyer is suffering here from the frustrating experience of items lost in the postal delivery service. They legitimately expect sellers to be considerate, recognize their disappointment, and try their best to help.
In the United Kingdom, the Royal Mail reported that in the financial year of 2010-2011 “we received about one complaint for every 13,000 items of mail we delivered.” That is a tiny percentage.
It’s more difficult to get figures for the United States postal system. The USPS is up-front about the amount of mail they could not deliver due to addressing issues, which in 2010 was 4.7%. We’re talking about indecipherable addresses, weather-damaged envelopes, and blank printed labels. Now, as a seller, you presumably take care in getting the addressing right, and are more interested in the percentage that falls into a black hole due to system or employee error. I spent some time searching for statistics of customer complaints to no avail.
Similarly, Canada Post will not reveal exact numbers of complaints about missing post.
If you’re wondering why the Royal Mail was more open as recently as 2011, the company was a public service for most of its history. The ordinary citizen could get these statistics as part of the Government Freedom of Information Act. Their counterparts elsewhere insist that such data is commercially sensitive information. In 2015, the company became fully privatised.
So let’s put a range of 0.01% to 3% on our estimates of lost mail. Online sellers of physically delivered goods should pick a reasonable number and cost it into their business. If you are sending out 100 items a month, you might factor in having to replace or refund three of those items. If you’re moving house and doing a once-off sale of ten items, you might think you’re unlikely to be unlucky enough to have one of them go astray.
OPTIONS FOR POSTAL DELIVERY
When sellers use the postal service to send goods, their choices are
1. Send through standard mail, no proof of postage, no recorded delivery
2. Obtain proof that the seller has posted the item, usually by going to a postal office or depot and getting a stamped receipt
3. Obtain proof that the buyer has received the item, by using a recorded delivery service
Let’s go through these one by one, starting with…
PERILS OF USING STANDARD POST
There are many reasons to go with standard post.
- It’s the cheapest method of postage.
- Proof of Postage is awkward for sellers, it requires physical travel to postal offices that offer the service, this may be onerous in many locations
- Recorded delivery is awkward for buyers, they have to be around to accept delivery, or travel to a pick-up depot. Some buyers may simply choose to avoid trading with sellers who insist on recorded delivery
- The seller is a crazy gambler
The seller has no protection if the buyer makes a claim to the online marketplace that they did not receive the goods.
That’s worth repeating: the seller has no protection if the buyer makes a claim to the online marketplace that they did not receive the goods.
If you are selling low-cost items in high volume, then you know your business and you absorb the risk.
If you are selling within a local marketplace where you know the buyers personally, then you may choose to rely on trust and reputation.
If you are not doing either of above, you’re a crazy gambler to stuff that smartphone into a padded envelope and drop it into the nearest post box.
So let’s say you acted like a crazy gambler, and you’ve received an email from the buyer, loaded with exclamation marks, saying they haven’t got their item yet. Or without even an email, you receive notification from the marketplace that the buyer has requested a refund due to “item not received.”
If you suspect that the buyer is pulling a fast one, there are a few last-ditch tactics you can try. I’ll describe these in another post.
Ultimately, you’ll probably have to accept you rolled the dice and lost.
- Send a refund
- Keep a record of the buyer ID
- Keep a record of any email they sent (or call they made) (I’ll detail why in another post)