Monday, May 31, 2010

Ebay Paypal dispute resolution unfair to sellers

To try and make my diecast collecting hobby self-sustaining I have been selling diecast cars through ebay for the last 6 months or so. 99% of transactions have gone perfectly and I have been very happy.

My feedback is very very good, and that pleases me. I go to great lengths to bubblewrap cars, I use foam peanuts and proper Australia Post packaging. I have gone out of my way to not engage in 'postal gouging'. My attitude is 'I want you to receive a tiny car in the same way that I would like to receive one'. I have seen very shonky packaging, boxed sets sent with no bubblewrap or peanuts so I always over protect the items. I have only had one report of a car arriving broken, and that was a piece that came adrift from a 1:18 Bburago Ferrari F50 in transit. Fortunately the person was able to clip the part back on the model. I was pretty distressed when i heard about that, and now I pop foam peanuts inside the models own packaging to avoid this.

On a few occasions items have not arrived at the buyers end. This is unfortunate for both buyer and seller.

Usually I hear nothing from the people who buy my tiny cars, in about 5% of sales, they let me know the car has arrived. Happily I have several repeat customers.

Once I sent the wrong cars to buyers, a case of switched addresses. This took a week or so to resolve, but it was. The person expecting their yellow jag was a bit surprised to receive a golden volkswagen!

When it goes wrong I usually get an an email from the buyer asking if I have sent the item. I then go through my Australia Post receipts (which list the postcode and date) and tell them when the item was mailed. Almost always the items turns up, one parcel took 3 weeks, others mailed that same day arrived 2 days later.

Twice they haven't. Once it was a 1:18 scale Biante XY GT. The buyer wasn't happy, and neither was I. I had only just started selling my cars and hadnt used registered post. After an 'investigation' Ebay refunded them the 140 dollars, plus the 14 dollars postage, and kept the fee they deduct from the sale as their commission. So I was out 140 plus 14 plus 9 (fee) plus the original cost of the model way back when. It put a real crimp in my very small revenues.

Im sure the person who was expecting their car to arrive was disappointed as well.

After that experience with Paypal I insisted that all sales over 20 dollars went 'registered mail' from that date, and I started to keep much better records - photographing parcels with the postal sticker applied at the post office and keeping the receipts listing postcodes.

One of the problems with the Paypal dispute resolution process is that they have very restrictive views on what constitutes 'proof'. See below:

What do Paypal consider 'proof' ?

This is where it is important that you keep receipts listing postcodes and photos of parcels showing addresses and postal stickers.

Im also not convinced that Paypal actually read any notes or evidence that sellers provide (outside the above three categories). They do not provide any decision making reasoning back to you. It is an imperfect process.

My advice to all sellers is to use registered mail and/or postal insurance. This raises your postage and handling charge, and takes extra time to fill out paperwork, but does protect you. Also, photograph all addressed parcels and receipts for postage (showing postcodes).

I am genuinely dismayed when an item does not arrive but Im also convinced that we have to be responsible for decisions we take. That includes choosing not to register and insure items that are purchased online.

Im interested in your ebay buying/selling experiences - particularly if you have gone through teh paypal dispute process as a buyer or seller. Please leave a comment. 


  1. Paypal "protection" is a sham. You must use registered, insured post to qualify, which means you have your own independant insurance anyway.

  2. I send all my items either Registered post or in an Express Post Platinum Courier satchel.

    From the Australia Post Website:

    Benefits of using Registered Post

    * proof that the article was sent when lodged at the post office counter
    * proof that the article was received - a signature is obtained on delivery
    * compensation for loss or damage of the article up to $100 for a standard registered delivery


    Features of Express Post Platinum

    * Guaranteed next day delivery across Australia within the Express Post network.
    * Signature on delivery of your item.
    * Automatic compensation up to $100 should loss or damage occur.
    * Extra Cover available - if your item exceeds $100 in value, you can purchase Extra Cover up to a limit of $5,000 from your local postal outlet.
    * Online item tracking.
    * Proof of posting - when your item is lodged over the post office counter, your receipt will be endorsed as proof of shipment. This is especially important if you're a seller using the PayPal online payment gateway to ensure that you qualify for PayPal seller protection.

    Obviously this imposes a shipping premium (an extra $2.30 for Registered Post articles) which is simply passed on to the purchaser, but highly recommended. It may cost you a few potential sales (from cheapskate buyers), but maintaining a high rating and covering potential loss or charge backs are worth it in the long run.

  3. Thanks Jon, i do use registered post, but hadnt considered Express Post Platinum.

    Obviously postal costs are a concern to buyers, but you are right. i dont understand people who spend 100 bucks plus on a diecast model, but arent happy about paying 3 extra dollars to register the item. As it says on all my ebay items now, if you dont like my reg post conditions, then dont bid.

    I go out of my way not to gouge on postal charges, i think i break even, and occasionally lose money - but spread over several items it tends to even out.