Auctioncope Auction Blog

Now that most of my shipping tips are out of the way, I thought it would make sense to move on to the eBay “Sell Your Item” form and work our way down.  The Item Title is one of the most important aspects of your eBay listing because it’s one of the only ways buyers will be able to find your item.  Usually, when a buyer searches for an item, all of the words they search for must be present in your title in order for your item to show up in their search results.  Because each Item Title is limited to only 55 characters, the words you pick are of the utmost importance.  Here are some tips to guarantee that your item will be seen by as many buyers as possible.

First, here’s some general advice:

1.      Never use words that a buyer is not likely to search for.  Words like “Awesome,” “Rare,” and “Great Deal!!” do not belong in an item title because a buyer will never search for them and find your item.

2.      Always use as close to the full 55 characters as possible.  There is always another useful keyword that can be added.

3.      If the item is new, make “New” or “NWT” the first word in the title.  This also helps raise visibility in “Best Match Search because new items are favored in search.

4.      I Recommend Capitalizing the First Letter of Each Word in the Title.  This calls attention to the item while not “yelling” at the buyer.  Never use all lowercase letters – it looks sloppy and gives the appearance that you are not interested in the item or the sale.

5.      If a word has an abbreviated form that the buyer may search for, use both the abbreviated and written out form of the word.  For example, if you’re selling a St. Patrick’s Day shirt, you’ll want to include both “Saint” and “St.” in the title because it’s possible buyers will only search for one or the other.  If a buyer searches for “Saint Patrick’s” and you only have “St. Patrick’s” in your title your item is not going to show up in the buyer’s search results.  Also note that eBay ignores most punctuation in Item Titles.  If your title is “Patricks” and a buyer searches for “Patrick’s” with the apostrophe the item will still display in the buyer’s results and vice versa.

6.      If the retail price of the item is much more than the asking price consider including it near the beginning of the title.  It should only take up about 4 characters, like $580 for example.  As you might have guessed, buyers are always looking for a bargain and this is an easy way to indicate that your item is what they’re looking for at a good price.

7.      It is no longer necessary to include both the singular and plural form of words.  For example, if a buyer searches for “American Apparel shirts” they will see all of the items that have “shirts” as well as “shirt” in the title, so including one or the other as appropriate in your title will suffice.

Next, I recommend doing a little research to find out what titles and keywords are most likely to bring the highest price.  I’ll be using the same Xbox 360 example as I used in the Raising Visibility in “Best Match Search” Guide.  The easiest way to do this is to search completed listings.  To do this, identify the most general keyword or phrase that a buyer is likely to search for and enter it into search.  I used “Xbox 360.”  Scroll down the page a bit and look on the left side for “Completed Listings” and click it.  You’ll have to be signed in to view these so do so if necessary.

Take a look at what titles and keywords other sellers are using to describe the item.  Make sure to note if the price the item sold for is green, red, or black.  Green indicates a sale, red indicates that the item did not sell at auction, and black indicates an item did not sell as a “fixed price” listing.  Once you start to get an idea, go to the top of the screen and choose “Price + Shipping Highest First” from the “Sort by” menu.

Don’t get too excited if there are some items that sold for thousands of dollars.  These auctions likely included extras.  Skip as many pages as it takes until you get to the specific item you’re selling and take note of what titles and keywords sold for the highest amount.  There’s nothing wrong with using the exact same title someone else has used in the past, but I recommend mixing up the words or tweaking it a bit so buyers don’t get confused and think your item is one they’ve already seen.  It’s also a good idea to check out the auctions that did well and note how they describe and display the item in words and pictures.  Also take note of auction duration and ending time.  Finally, check to see if you can figure out where the buyer is located.  Many times an auction that sells for a higher price than usual is purchased by a bidder in a country prone to scamming.  Try to emulate these same methods in your own listing and you should be just as successful.

Terapeak Title Builder is another useful tool available for free from Terapeak. Start with the general keyword or phrase you used from the last section and enter it. Terapeak will randomly select 100 listings with that word or phrase and tell you how many of those listings include a variety of other keywords. It also shows the price those items sold for with the additional keywords listed. It’s a little deceptive because a keyword could indicate a completely different item from what you’re selling. For example, if you add “Elite” to “Xbox 360” you come up with a completely different item than the regular Xbox 360 console we have available for sale. Be careful here, but it might give you an idea of some extra words to include if you have some extra space in your title and can’t think of anything else to add.

Finally, BayEstimator is a tool available from eBay Research Labs that is helpful because it actually uses eBay search technology to help you create the best title possible. It’s a little bit complicated to pick up so I’ll let you look over their instructions and FAQ yourself rather than try to paraphrase here. I would only recommend BayEstimator if you are a seasoned seller or otherwise have an unhealthy curiosity for eBay search technology. It’s also unclear if it has been updated with new information since May of 2008. Nonetheless, it may be interesting to check it out. New sellers could probably spend their time learning more valuable techniques.

The goal is to create a title filled with keywords and phrases that buyers are most likely to search for, as well as one that eBay thinks buyers are most interested in.  The trick is to think about what words you would use to search for the item and then put those words in the title.  Along with that, you want to include keywords other people would search for as well.  Use the techniques above to help you get a feel for what those keywords might be.  Once you master that, you’ll be one step closer to maximizing hits on your items.

Since I’m just about done with shipping guides for now, I thought I would create a quick cheat sheet for those who may have missed a guide.  The way the blog is currently set up is not necessarily conducive to the easy access of information.  I apologize for that and am working on a better setup.

When to Buy Shipping Insurance Part One – The Buyer’s Perspective – Explains that the buyer is not responsible for paying shipping insurance. If the item is damaged during shipment it is the seller’s responsibility to refund the buyer and proceed through filing a claim.

When to Buy Shipping Insurance Part Two – The eBay Seller’s Perspective – Explains the options sellers have to insure their packages. Shipping insurance is often not a wise investment because it is extraordinarily difficult to get a claim granted.

Utilizing USPS Priority Mail Flat Rate Boxes For Your eBay Business – Explains when it is cost efficient to use Flat Rate Envelopes and Boxes rather than variable rate packaging. Identifies the sizes and costs of each.

The Limitations of USPS Delivery Confirmation – Explains that Delivery Confirmation numbers are not meant to be used for “tracking” a package during transit. Nonetheless, it is imperative that a minimum of Delivery Confirmation be used on every item a seller ships.

How to Use USPS Signature Confirmation Effectively with eBay and Paypal – Explains when Signature Confirmation must be used by sellers on eBay when accepting Paypal. Also outlines its weaknesses for both the buyer and seller.

The Perils of International Shipping With eBay and Paypal – A Guide to Successful Shipping Practices Explains in detail the many international shipping options available to sellers. Following these guidelines is imperative for any seller wanting to open up their business to international customers. Without this vital information sellers run the risk of heavy losses.

A Tutorial on How to Use Paypal MultiOrder Shipping Efficiently to Save Time and Money on Postage Explains how to set up Paypal MultiOrder Shipping with easy to follow instructions and pictures. This cuts the time it takes to print shipping labels by as much as 90%.

USPS Shipping Tips and Tricks For Buying and Selling With eBay and Paypal This is a compilation of tips and tricks I have picked up over my 5 years selling on eBay.

If there’s a guide you would like to see posted on shipping, or anything else, leave a comment or send me an email.

As reported yesterday, many members of the eBay community believe eBay is intentionally lowering Detailed Seller Ratings in order to deny sellers fee credits that could be worth hundreds of millions of dollars.  Just last month, after two years of increasing speculation and accusations, eBay attempted to placate sellers by allowing them to create various ratings reports based on things like item categories and buyer location.  These reports all lack one key characteristic.  It is still impossible to verify whether or not the numbers eBay is reporting are accurate.  Indeed, eBay has every motive to inaccurately report Detailed Seller Ratings.  After all, their stock price is dependent on increasing marketplace revenue, not crediting it back to sellers.  Fearing that crafty sellers would figure out a way to use the new reports to pinpoint what ratings buyers actually left, eBay made up two new policy violations aimed at suspending anyone who tried to prove once and for all that they had been manipulating ratings all along.  It is also now a policy violation to ask any buyer what ratings they left.  Why?  EBay is doing everything in their power to deny sellers the evidence they would need to file a class-action lawsuit against the company.

Recently, eBay has devised newer, more efficient ways of denying sellers fee credits.  If you remember from my last article, there are two qualifications that have to be met to earn final value fee credits.  The first is minimum Detailed Seller Ratings. The second is current Powerseller status.  The Powerseller qualification denies most casual sellers from ever receiving a fee credit because it is necessary to have sustained sales of $1,000 a month for 3 months as well as a minimum feedback score of 100. Powerseller accounts are also username specific, so if a seller uses more than one username in order to sell a variety of products, they will have to meet these minimums on every account they expect to qualify for a fee credit; no matter what their overall sales or feedback might be.  The key to being a Powerseller though, is complying with eBay’s listing and marketplace policies that number in the hundreds.

EBay can issue policy violations to anyone they want, whenever they want.  No evidence or explanation is necessary and rarely is one offered.  Two “serious” violations and a seller will likely have all of their accounts suspended and their Powerseller status revoked.  By revoking Powerseller status, eBay no longer has to be concerned with a seller’s Detailed Seller Ratings. They no longer matter.  Diane, a Powerseller for more than two years writes:

“Until last month I had never received a policy violation in my three years selling children’s toys on eBay.  I received my first policy violation on March 2 2009 for “intent to disrupt a listing.”  Three days later and before I even received a response back about what the first violation was about I received another violation for “unauthorized item” on an Elmo playset.  Exactly one minute after I received that email I received another email that said my account was suspended…It took me 11 days of emailing and calling to get my account reinstated and when it finally was I realized I was no longer a Powerseller… Before I was reinstated I had to pay over $900 in eBay fees and I was told I would not receive any of the 30% credit I was due.  So much for 99.9% positive feedback, 4.9 DSRs, and thousands of dollars lost on shipping buyers items for free…”

Nicole, another long time eBay Powerseller reports:

“Two years selling on Ebay and they took away my powerseller status because Ebay says that I sell unauthorized items.  I told them that I get all of my items from reputable stores and I know how to tell if something is real but they didn’t care.  They even tell you they have no idea if what you’re selling is authorized or not but if anyone on Ebay says it isnt then that’s enough…Now I can’t get any fee discounts even if I offer to ship free…”

There are potentially thousands of stories just like these.  By issuing policy violations to revoke Powerseller status, eBay can more efficiently limit sellers’ ability to qualify for fee credits for the entire duration of the promotion.  By the time sellers are able to qualify for Powerseller status again, the promotion will have already expired.  Plus, eBay can deny sellers the fee credits they have already earned by forcing them to pay their fees before eBay even allows them to list another item.  Many of the complaints are from sellers who also offer free shipping and qualify for double fee credits.  These sellers can earn a total of as much as 40% off final value fees.  Why decrease fee credits from 40% to 30% by artificially lowering Detailed Seller Ratings when it’s so easy to make it 0% with no hope of ever receiving another credit?

There are no coincidences when it comes to eBay and money.  This promotion was well planned and executed from the start. Until eBay removes Detailed Seller Ratings and Powerseller status from its revenue stream, neither are safe.

In April 2008, eBay began issuing final value fee credits to sellers who met a certain set of qualifications.  These qualifications included minimum Detailed Seller Ratings of 4.6 in all four categories, as well as current Powerseller status.  At the time, most sellers were excited about having the opportunity to save money on fees that otherwise were only increasing.  Unfortunately for most sellers, these savings never became a reality.  First, for nearly two years it was impossible to find out what Detailed Seller Ratings specific buyers were leaving for sellers.  The program was completely “anonymous.”  How are eBay sellers supposed to improve customer satisfaction if they don’t know which buyers are dissatisfied and what the cause of that dissatisfaction is?  EBay has never provided a reasonable answer.

Many sellers believe eBay intentionally manipulates Detailed Seller Ratings in order to deny sellers fee discounts.  Since it is impossible for sellers, or anyone else, to calculate their own Detailed Seller Ratings, they are forced to rely on whatever eBay says their ratings are.  Because the ratings are not public, there is no evidence available for the seller to prove otherwise.  On top of that, eBay announced the very next month that they would be doing away with Mutual Feedback Withdrawal.  Mutual Feedback Withdrawal had been an opportunity for sellers to work problems out with buyers who did not contact them about problems before leaving poor feedback.  Without it, there would no longer be any opportunity, and for many, no motivation, to fix problems and get unnecessary negative feedback removed.  EBay knows that more negative feedback means lower Detailed Seller Ratings. Lower Ratings means eBay would be forced to issue fewer fee discounts.

After two years of constant complaining by many in the eBay community, eBay relented a bit and made it possible to view certain Detailed Selling Rating reports.  With a little trickery, it is now possible to find out exactly what Detailed Seller Ratings specific buyers left.  I would explain how to do this, but soon after it was reported to be possible, eBay added two sentences to their definition of ”Feedback Manipulation”

“Taking any actions, including the use of tools, to determine the Detailed Seller Ratings a buyer left for a specific transaction may also be considered Feedback Manipulation.  DSRs are meant to be anonymous.”

How exactly is checking Detailed Seller Ratings manipulation of feedback?  How does it change the scores in any way?  Why are Detailed Seller Ratings “meant to be anonymous” while positive/negative/neutral feedback ratings have always been clearly visible and attributable to specific buyers?  What exactly does eBay not want you to know?  The answers become clear.  In order for eBay to deny sellers fee discounts, they cannot allow sellers to find out what their actual Detailed Seller Ratings are.  EBay will go as far as to permanently suspend a seller who attempts to find out what Ratings buyers have left.  EBay has a tool that tells them how many Ratings reports a seller creates.  If they go over a certain threshold, an eBay employee looks over the activity and issues a policy violation.  Two policy violations in the last few months and it’s a suspension, possibly forever.

EBay should not have tied Detailed Seller Ratings to their revenue stream.  Once they did, sellers around the world lost any hope of a fair feedback system.  EBay does not want to fix the flaws inherent in the Ratings system because they would lose hundreds of millions of dollars in revenue if they did.  EBay has put themselves in an impossible position where they are forced to deny even the most reasonable requests because of their responsibility to their stock price.  We can all pray that eBay finally discontinues final value fee credits based on Detailed Seller Ratings because only then will they be willing to make the necessary repairs to a system that has been broken for two years too long.

EBay has a new trick up their sleeve.  They are stripping sellers of their Powerseller status by issuing bogus listing violations.  Look for the full story tomorrow.

Paypal MultiOrder Shipping (Yes I know “MultiOrder” is an odd looking word, but that’s what they call it) is a free and relatively easy to use tool provided by Paypal to print up to 50 domestic shipping labels at one time.  You can import your orders paid with Paypal, your eBay orders whether paid with Paypal or not, a .CSV or .TSV file, or make shipping labels from scratch.  MultiOrder shipping is faster than printing one label at a time because in MultiOrder shipping it is possible to quickly assign a “shipping preset” that is preprogrammed with all the information you would normally have to click for every label.  Once you familiarize yourself with the process, you’ll be amazed at how many labels you can print in the time it used to take to print two or three.

Click the link below or the title above to learn how:

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This article’s main points and concerns are:

If you add shipping insurance you must also add Delivery Confirmation or Signature Confirmation.

Buyers, when returning an item to a seller, you must use the same techniques sellers use to ship to you.

Understanding how USPS rates work can save you serious money.

Hide or show the postage cost when shipping with Paypal.

Turn off shipping receipts to save paper/labels.

Use Paypal to print a shipping label to anywhere, even when there is no accompanying payment.

USPS Priority Tyvek Envelopes are strong, lightweight, and free.

Utilize Self Adhesive Shipping Labels to Save Time.

Click the link below or the article title up top to learn how.

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This article’s main points and concerns are:

Signature Confirmation is required on all transactions of $250 or more.

During transit, packages with Signature Confirmation act the same as those with Delivery Confirmation.

How to avoid buyers who prey on sellers unfamiliar with certain shipping technicalities.

Signature Confirmation represents a potential hassle to the buyer if they are not present to sign for the package.

Paypal has changed the way they decide disputes when the Signature Confirmation numbers says delivery was attempted.

Buyers must pick up packages held at the Post Office as soon as possible because they are not as well protected as they once were.

Read the entirety of this article by clicking the link below or the title above:

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EBay’s revenue and profits exceeded Wall Street’s expectations again this quarter. Revenue topped 2.02 billion compared to the estimate of 1.94 billion and profit per share was 39 cents compared to the consensus expectations in the 33 cent range. eBay’s payment division, which includes Paypal, was the strongest of eBay’s businesses, bringing in revenue of 643 million dollars on 15.86 billion in payments processed. This represents an increase of 10% year over year. Revenue for eBay’s Marketplace division, which includes eBay’s core auction website, decreased 18% year over year to 1.22 billion dollars. Looking forward, eBay expects revenue in the second quarter to be similar to the first. Estimated revenue is in the 1.85 to 2.05 range and earnings per share in the .34 to .36 cent range.

EBay stock was up 49 cents in regular trading to $14.78 and is up between 5 and 10 percent after hours, trading above $15 for only the second time in the last 4 months.

EBay will announce quarterly earnings this afternoon. A number of other major companies will announce earnings as well, including Apple, McDonalds, Boeing, and AT & T just to name a few. Analysts expect a profit of 34 cents a share on 1.94 billion dollars in revenue. Profit per share would be the lowest since the first quarter of 2007. Over the past 10 quarters, eBay has consistently beat expectations, so the actual numbers may be slightly higher. The stock is currently trading around the $14 mark, up from a 52 week low of $9.91 but significantly lower than the high of $32.10. The Wall Street consensus has eBay stock rated a “hold.” Somewhat against the grain, Standard and Poor’s has reiterated a 5 star “Strong Buy” rating four times in the past ten days. Their 12-month target price is $18. Other analysts have the number slightly higher or lower.

EBay leadership has made some significant decisions in the past week that may help position the company more favorably in the future, and make for a more interesting conference call with investors today. The most publicized has been the future of Skype, which eBay plans to either sell off in the form of an Initial Stock Offering some time next year or sell outright back to its founders. The decision will probably depend on the status of the economy and whether or not the stock market has continued to rebound. Skype, which eBay famously acquired in 2005 for 2.6 billion dollars, never materialized into profits. EBay never successfully integrated the chat platform into its auction website and the transaction is thought of by many as one of the company’s most serious mistakes. Nonetheless, Standard and Poor’s believes the sale may net the company as much as 2.7 billion dollars, so the overall loss could be much less than the more than one billion initially feared. Much less publicized is eBay’s announcement to purchase South Korea’s leading auction site Gmarket for 1.2 billion dollars. EBay has had serious trouble penetrating Asia’s fickle markets and the move has the potential of increasing eBay’s presence on the Mainland in the future.

EBay’s bright spot is its Paypal division, which eBay expects to process more than 100 billion dollars in payments by 2011. Paypal is hugely profitable because they charge the same fees whether the payment is a credit card transaction or not. Many Paypal transactions are pure profit for the company as the cost to transfer money from one Paypal account to another is virtually zero. In addition, eBay has successfully kept payment processors like Google Checkout and Amazon’s service off of eBay, creating the best monopoly legally available. Much less successful is eBay’s core auction business. Nielson ratings show a 5.2 percent drop in unique visitors and a 27 percent drop in page views when comparing March 2009 with March 2008. This translates to lower prices, fewer sales, and ultimately less commissions for eBay. Such a substantial drop in page views is dire news for a company whose business used to be solely auction related.

EBay’s troubles will likely continue through 2009, as more sellers leave the platform for alternative venues. Tough economic times will continue to be a mixed blessing as well, as buyers turn to eBay for bargains, but don’t have as much money to spend on luxury items. EBay has been running attractive promotions for sellers, including final value fee credits on items listed with free shipping, but many fall short of the real changes sellers are demanding. It is difficult to gauge what eBay’s core auction strategy will be in the future. For much of 2008 they tried to compete with Amazon by inviting stores with a large presence online, like Buy.com, to list items at greatly reduced costs. More recent announcements point in a different direction. EBay’s best move may be international expansion. Their proposed acquisition of Gmarket is proof that the company is still mindful of international markets. Plus, there might still be people somewhere out there that eBay has not yet pissed off.

Take care, and let’s hope today’s news is good.

For Part 1, shipping insurance from the buyer’s perspective, please see When to Buy Shipping Insurance on Your eBay Purchase Part One – The Buyer’s Perspective

Many sellers have a disclaimer in their listing stating something to the effect of, “Not responsible for lost or damaged items if buyer does not pay for shipping insurance.” As I explained in Part 1, this statement is entirely false.  The seller is responsible for delivering the item to the buyer as described in the listing. Period.    No clause or fine print will get a seller out of this responsibility.  If the buyer receives an item that is not described accurately, they can open a dispute with Paypal or the credit card they used to make payment.  The buyer will win and the seller will be forced to issue a full refund.  The seller can point to their “Not Responsible” clause all they want.  It doesn’t matter.  It is not the buyer’s responsibility to ensure that the seller packaged the item properly nor is it their responsibility to ensure that the seller described the item accurately.  Paypal does not care when the damage occurred, only that it is damaged and the buyer did not receive the item that was advertised.  This being said, many sellers will try to convince buyers that because they have the “Not Responsible” clause, they are actually not responsible.  Many times the buyer will believe them and not take the issue up with Paypal or their credit card.  My point is not to argue the ethics or morals of “how a good seller acts,” only to point out that if the buyer receives an item that is not as advertised, it does not matter if they purchased shipping insurance or any other additional shipping service.  If the buyer is familiar with their rights, and more importantly how Paypal works, they will file a claim against the seller, receive a refund, and most likely leave terrible feedback and Detailed Seller Ratings.

So when should a seller pay for shipping insurance?  Unfortunately, at least when purchasing first party insurance from the carrier, the answer is likely never.  Here are some reasons why.  First, it is nearly impossible to get USPS, UPS, DHL, or similar companies to grant an insurance claim.  USPS can deny a claim based on “insufficient packaging.”  Their argument is that any item that is damaged during transit was insufficiently packaged by definition.  After all, if the item was packaged properly then it would not have been damaged would it?   Second, USPS insurance does not cover “shock” to the package.  This means that if the item is dropped, but the packaging still looks intact, insurance will not cover it. So forget collecting on that laptop that was dropped repeatedly during transit and won’t turn on.  For a complete list of what does not qualify, check out USPS Nonpayable Claims There is an appeals process for denied claims, but your odds certainly don’t improve at that point.  Third, USPS recently announced that as of May 11, 2009 all claims will be decided by a centrally located division in Missouri called “Accounting Services,” instead of at your local Post Office.  A cynical person might assume that USPS is doing this because too many local Post Offices were being lenient with granting claims.  Don’t be fooled.  USPS lost nearly 3 billion dollars last year and they’re doing everything in their power to trim costs, including weaseling out of paying your $1,000 laptop claim by any means necessary.  Have you heard about people having difficulties collecting on warranties purchased at stores like Best Buy?  Heard about dying people getting denied heart transplants by their health insurance?  Cakewalk in comparison.  As of May 11, USPS no longer even requires you to bring the packaging or the item to the Post Office when submitting the claim, probably because they expect to deny your claim long before that even becomes an issue.  They reserve the right to inspect and impound the item and packaging at some point, and they certainly would before they consider granting your claim, but you could claim victory if you even make it that far.

Now that I feel a little better, let’s consider third party insurance.   Third party insurance is available from companies like Shipsurance and U-Pic .  These companies insure your packages just like USPS or UPS does.  On top of that, they do so at a discounted rate.  The general consensus is that you have a much better chance collecting from third party insurers, so they may be your best bet if you have a need to insure your items.  You can view the introductory claims form from U-Pic here: U-Pic Claim and Shipsurance here: Shipsurance Claims Forms so you can prepare for what will be necessary in case you do need to file a claim.  Also, make sure you are familiar with the terms and conditions like the ones from Shipsurance available here Shipsurance Terms Note that like with USPS, they can deny your claim based on insufficient packaging as well as “Mechanical and Electrical Derangement” which basically amounts to the Postal Service’s “shock” exclusion explained earlier.  There are also various other downsides to third party insurance.  The first is that there is no indication on the packaging or shipping label that the item is actually insured by the third party.   Buyers who pay for insurance may question whether or not insurance was actually purchased or if their $2 was a waste of money.  If a seller requires shipping insurance and the amount exceeds a couple dollars, they can expect to receive some complaints from buyers who are unfamiliar with how third party insurance works.  Shipsurance provides printable inserts that state the package is insured, but even that may not stop the wrath of the dreaded crazy eBay buyer.  Second, keeping track of all of the insurance information can be a serious hassle if a seller ships in volume.  If a seller takes packages to the post office to be weighed and mailed, they will also have to manually enter that information online at their respective insurance website.  Shipsurance offers a program to make it much easier when printing labels online so I recommend integrating that if possible.  If you insist on insuring packages, seriously consider changing to a third party insurer.

I should make an important point here.  Third party insurance companies would not exist if USPS or other carriers lost and damaged items routinely.  It is rare for an item to be damaged by carrier negligence that would constitute a grantable claim, which is why insurers can offer $1000 worth of insurance for $10 or less.  If they expected to pay out more than 1% of these claims they would lose money.  Like I explained in my Delivery Confirmation guide, I have only lost one package out of more than 50,000 shipped via USPS Priority Mail with Delivery Confirmation.  As a seller, you have to decide whether paying for shipping insurance is an economical choice and understand that in the long run the insurer always wins.

Finally, let’s consider what happens if the buyer claims that the item they received was damaged and the seller wants to file an insurance claim.  First, the seller will have to have the full cooperation of the buyer to fill out the required affidavit that the item was received damaged.   Considering the difficulties in getting many buyers to leave feedback or reply to even the most basic email, it may be difficult to relay all of the appropriate information to the buyer and have them complete it correctly.   USPS can deny claims if “The sender or addressee failed to cooperate in the completion of required claim forms.”  As the seller, you will have limited control over the claims process. Second, the buyer will have to hold on to the packaging and the damaged item through the insurance claims process, which may take several weeks.  With USPS, if the buyer returns the item to the seller it will likely invalidate the insurance claim as USPS will argue that there is no proof that the damage was not caused by return shipping. This puts the seller in a difficult position.  Buyers who understand that they can receive a refund from Paypal will likely demand one long before the insurance claim is decided.  If the seller provides this refund, then the buyer will have even less reason to deal with the complicated insurance claims process. In addition, whoever files the insurance claim will have to provide proof that the item is worth the amount declared, along with proof of insurance, and proof of damage.  The buyer will not have access to this information, so the seller will either have to send it to the buyer or try to submit the documentation themselves.  There are a great number of problems associated with filing insurance claims.  The process is meant to be difficult and frustrating because the insurer does not want to pay the claim. The absolute last thing USPS or any other insurer wants to do is grant an insurance claim for a large amount of money and they will do anything and everything in their power to see to it that your claim is denied.

Like with all insurances, shipping insurance is meant to be profitable for the insurer.  To be profitable, the insurer must deny as many claims as possible.  This makes shipping insurance an unattractive investment.   If you do ship items that require insurance, consider a reputable third party insurer like Shipsurance.  They are both cheaper than the carriers and more likely to pay out if damage or loss occurs.