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Sellers: Are Shippers Sending Your Money Away?



by David Utter

UPS and FedEx hold dominant positions in the shipping industry, providing the fulfillment of thousands of ecommerce orders year after year. These shippers have many policies regarding what sellers need to do to, but one particular policy could mean significant cash for those same sellers.

 

A service called 71lbs.com notes that money-back guarantee policies for FedEx and UPS assure sellers they are entitled to refunds on all late deliveries. Likewise, other shipper errors mean money back for sellers if they make timely claims for reimbursement.

Sellers wishing to outsource that process can turn to 71lbs.com. The company audits shipping invoices for errors, and makes refund claims for late shipments or ones that arrive lost or damaged. 71lbs.com COO Ellen Riley told EcommerceBytes more about how this process works.

"The one concern that I hear a lot from people in the decision making process is that they don't understand their shipping spend with the carriers," Riley said. "They don't know if they are going to hurt their relationship with the carrier by making claims."

"As I always ask, if you go to Ruth's Chris Steak House, order a rare NY Strip, it comes out well done, do you eat it or do you send it back because it is not what you are paying for on the Money Back Guarantees/Guaranteed Service Refunds - it puts it into perspective for them," Riley said.

The service also extends to international shipments. "International as well as domestic are audited; it is up to the policies of the carrier if they will (issue) refunds," Riley said, while noting "Customs is what will kill a refund."

Getting started with 71lbs.com requires sellers to provide the service with the user credentials for the online billing accounts for their carriers, Riley said. Regarding the pricing structure for the service, Riley said, "The company gets the full amount of the refund back into their shipping account and then we invoice them at the end of the month for the agreed to price. If someone has a higher shipping spend, the pricing is lower, similar to what happens with the carriers."

How much can 71lbs.com save a given seller? "There is no simple answer to this question - other companies quote percentages; we used to. We don't anymore as each company negotiates their agreements differently, the carriers are more tricky about putting waivers for various surcharges or shipping services. Depending upon the services used, zones shipped to, the percentage of total cost in refunds varies greatly," Riley noted.

For FBA or eBay sellers using those firm's shipping services, Riley noted those sellers don't have the same delivery guarantees as when they ship on their own accounts, so unfortunately 71lbs won't work for those sellers.

Low volume shippers should consider the service as there are potential gains to be realized. Said Riley, "Most people wouldn't take the time to file and follow up on their claims - it isn't as simple to identify late shipments as one would think."

Riley also said the company's efforts at lost/damaged claims resolution, customer service, and human-backed automated approach to monitoring shipping accounts distinguish 71lbs.com from others in its niche. Sellers interested in optimizing their shipping spend and lacking the time or staffing to investigate every shipment may want to consider this service.

About the Author: David A. Utter is a freelance writer based in Lexington, KY. He has covered technology topics from search to security to online business and has been quoted in places like ZDNet and BusinessWeek. He considers his appearance on NPR's "All Things Considered" with long-time host Robert Siegel a delightful highlight. You can find him on Twitter @davidautter and on LinkedIn.