>Bunga, in what scenarios have you charged restocking fees on your Amazon returns?
The only scenario in which you can charge restocking is for a customer discretionary return, unless you’re talking about the 50% for damaged product version. We have done both.
As to discretionary, in the past we charged 15% restocking for sales above some level, I can’t remember, $35 maybe. We charged it above some level because Amazon gets too big a bite at points below that, and because in those days any A-z counted against you, so it seemed too dangerous to grab a $3 restocking fee of which Amazon was getting $1.80, meaning we took the neg / A-z risk but got 40% of the payoff.
When the new Amazon fee structure came through we went to 20% for all returns, because for customer returns where shipping is not refunded, Amazon would keep a fee of $1.80 + $0.60 = $2.40 leaving a whole $1.59 to cover our outbound shipping, and that was not enough. Also, denied claims no longer count against the seller, and our experience has been that we get few claims relating to restocking in any event, so we felt we could push the envelope a bit.
>You make the point that you will typically win A-Z’s in the case of buyers protesting restocking fees. However, it is still a metric hit, unlike an INR with buy shipping services, for example.
Denied A-z claims have not hit sellers’ metrics for quite some time now.
And even if they did . . . as I said upthread, we had a 0.7% rate of restocking fee instances with claims to restocking fee instances. If we had lost them all, the effect on our ODRs would have been imperceptible. As it happened, we won them all, primarily because restocking fees are allowed on Amazon, and because of course we don’t charge them in situations where they are not warranted.
As to the general decision to charge restocking, overall I think commodity sellers should, and are more likely to do so, and more specialized sellers should not, and are more likely not to. The former rarely get repeat business because their customer base goes strictly on price, so annoying the customer is a comparatively unimportant negative, and keeping costs down is very important, whereas the latter get repeat business from people buying in their area, so keeping the customer happy is more important, and higher margins make it easier to absorb the cost of returns.
Philosophically I prefer to have the person who is returning something cover the costs associated with his own return, rather than expecting all of my customers, including the 98.5% who don’t return their purchases, to cover them. That’s not particularly compelling as far as making the decision whether or not to charge them goes, but it sits well with me.