No final value fee credits for postage refunds
A Tamebay reader asked the question “If a buyer overpays on postage rather than requesting a total when I make a partial refund would I get a final value fee credit”.
The answer from eBay support was “No”.
We’re not surprised by this at Tamebay, eBay generally only give final value fee credits for entire refunds under limited circumstances (mainly for cases in the resolution centre in which you agree a full refund with the buyer before the case is escalated to eBay.
It doesn’t matter if the buyer didn’t pay, you and your buyer mutually agree to cancel the transaction, or the buyer opens a case and you agree a refund, the case has to be opened in the resolution centre. You won’t however receive a final value fee credit for any cases opened on PayPal.
So as eBay don’t give partial final value fee credits for partial refunds, it’s understandable (but regrettable) that they also won’t give final value fee credits for partial postage refunds.
That being the case the it’s now time to start using eBay’s postage rules to ensure that any postage discounts you wish to offer are automatically applied at checkout. There are two main options:
Flat Postage Rules
You can choose to charge for delivering the item with the highest P&P cost, and then add an additional lower cost for each additional item that they purchase from you. You can also subtract P&P costs for each additional item purchased, or offer free P&P on additional items.
Promotional postage rules
You can offer buyers special discounts if they buy multiple items or spend a certain amount. For example, you can create a rule that gives buyers free P&P as long as they spend at least £25 and buy 2 items. You can also charge a maximum P&P amount for a single order. For example, you can specify that a buyer be charged no more than £5.00 for P&P if the buyer purchases more than one item from you.
What should I do?
We understand that many sellers have routinely refunded overpaid postage. We also know from experience just how hard it is to set postage rules which cover very light weight items sold alongside much heavier products. We also know from a buyer perspective that it’s much easier to be able to click to buy and click to pay without having to request a shipping total and hope your selling is online sometime soon to send you an invoice.
The options available to sellers are pretty simple – set up your postage rules; charge as normal, pocket any overpayments and hope your Detailed Seller Ratings don’t get too many hits; or refund overpaid postage and accept that you’ll have paid final value fees on the refunded overpayment so build it into your costs.
There is of course one other option and that’s to have everything free (included) postage so there’ll never be overpayments to refund, but we know that won’t work for all sellers and typically the sellers who have the most postage partial refunds to do are the very sellers for whom free P&P wouldn’t work for in the first place.
What’s it going to cost you?
If you want to know the potential final value fee overpayment then download your PayPal history and sort by refunds for the last few months. Then apply the typical final value fee for the categories you sell in and then you’ll know the additional fees you’ll need to budget for.