eBay Returns and Refunds Management: Mastering the Basics

In a perfect world, all online shopping transactions go seamlessly well, and both buyers and sellers end up happy and satisfied. In reality, though, a commodity sold virtually goes through a lot before it lands on the customer’s doorstep. Shipping delays happen, packages get missing or mixed up, items arrive broken or different from what the buyer had envisioned based on the product description and photos.

How refunds and returns work on eBay may be intimidating or mind-boggling, and some sellers would rather just pray these inconveniences don’t happen so they won’t have to deal with them. But they will inevitably happen. That’s why it pays to know the ins and outs and be prepared to support your customer and protect your business.

Here we’ll present common scenarios and how to best handle them.

Scenario 1: A customer wants to return an item

You need to know this upfront: eBay will always favor the customers requesting return in certain applicable cases under its Money-Back Guarantee Policy. The seller is obliged to return and refund the customer if any of the following happen.

The item arrived damaged.
The item received did not match the product description.
The item received was incorrect.

This policy holds regardless of whether you clearly stated in your listing that you wouldn’t allow returns. However, this does not discourage you from setting your returns and refunds policy. It is advantageous for you and your potential buyers to set rules before the purchase so that both parties are on the same page. Being transparent about your return rules might also affect a buyer’s decision to purchase from you because sometimes, “Free returns” are the only reassurance a hesitant customer needs to convince her to buy.

These are the steps and considerations to help you set up your returns policy:

On your Account Tab, find “Return Preferences” under “Site Preferences.”

Clearly state in your listing if you accept returns or not (As mentioned earlier, eBay can still hold you liable for returns and refunds in certain cases.)
If you are amenable to returns, choose the reasons acceptable to you. Options include buyer’s remorse – it happens when they realize they don’t want your item anymore. Once you accept a customer’s return request, they have a maximum of 15 business days to have it shipped back. Otherwise, eBay could close their request.
Determine the timeframe within which the items are considered valid for returns and who should pay for shipping the returned item back to you. Examples of the options include free return shipping within 30 days, or the buyer should return shipping within 60 days. Take note that certain product categories such as “Collectibles & Art” and “Jewelry” allow for a 7-day return period aside from the standard 30-day and 60-day options.
Provide your returns address if it differs from your registered address (which is where the returns will be delivered by default if there’s no return address provided).

These new rules will automatically apply only to your future returns. Always check your account or email for notifications on return requests because a seller only has three business days to respond and work with the buyer in resolving the case.

Scenario 2: A customer is asking for a refund

Returns and refunds often go hand in hand. Customers are entitled to a refund if their cases fall under the non-negotiables (damaged, incorrect item, not as listed) and if they did not receive their item at all.

Sellers may set up their own rules on the refund. Check “Send a Refund” to explore your options under “Returns Preferences.” These are some things to keep in mind:

You may set a maximum figure for how much you are willing to automatically refund a customer. For example, you can set a rule to automatically approve refunds within $250 provided that the reason for return and refund is acceptable to you (as configured in your preferences).
You may arrange for full or partial automation of these rules. While the former speeds up the entire process – something your customers would appreciate, the latter adds a layer of protection as you would need to review certain parts and approve the request manually.
You must refund your customer within two business days of the receipt of the returned item. The refund amount should be in full unless the item came back to you damaged, altered, or had missing parts. In this case, eBay may allow you to reduce the amount you are refunding.

Scenario 3: A customer sends a cancellation request

Time is the main factor in this case. The sooner the customer requests for cancellation, the more the seller is expected to consider it. If the buyer did it within an hour of purchase and you haven’t shipped the item out yet, eBay recommends that sellers understand and approve the cancellation request.

Customers cannot request to cancel an order that’s already in transit. They must wait for it to arrive before submitting a return request instead.

Also, if you approve a request for an item that’s part of a multiple order, everything else will be canceled, as eBay doesn’t allow individual cancellation for such cases.

Scenario 4: A customer’s order is missing

The seller’s responsibility is to check with the courier and provide a delivery update on the missing package within three business days since the customer’s notification*. Note that if you’re not using an eBay label, the courier you contracted should have tracking integrated by eBay, or else, you won’t be covered when a package gets lost.

If the item is confirmed to be missing and cannot be retrieved, the customer may request that the seller send a new one (replacement) or a similar item of the same value or less (exchange) if they don’t want to be refunded.

*eBay recommends that a customer reach out to a seller several days after the expected delivery date, in consideration of the delays that happen from time to time when shipping volumes spike. However, the notification should not be done beyond 30 business days.

Scenario 5: The seller and the buyer are struggling to find a resolution

If you have not yet sorted out a missing item or returns issue after three business days, you or the seller can ask eBay to step in. Simply locate the “Returns” or “Requests and Disputes” from your Seller Hub or My eBay Sold and report the problem or “Ask eBay to step in and help.” It usually takes eBay two business days to respond unless more information is needed.

You must keep in mind that eBay encourages sellers to close customers’ issues by themselves because if they step in and side with the buyer, the sellers’ level or performance status may take a hit.

Should you feel strongly about challenging eBay’s decision, you may appeal with fresh supporting evidence, not more than 30 days since the case resolution.

For the last part of this article, we’re not giving another scenario but rather equipping you with more tips and reminders to help you avoid (or handle) sticky seller situations.

Be honest and clear when crafting your product descriptions. Avoid misleading statements and product photos so you won’t be obliged to accept a return request for an item that was not as advertised.
Regularly check your email or app notifications for new return requests. Also, vigilantly monitor open cases for any updates that may require immediate action from your end.
Remain polite and professional at all times when working out an issue with your customer – even if it’s challenging to do so.