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eBay Cracks Down on Poor Sellers

August 17th, 2007 by Skip McGrath

eBay announced today they will restrict seller accounts with a 5% Neutral/Negative in past 90 days

I received a nice email from eBay today congratulating and thanking me for being a good seller.  Then it went on to explain (warn me) that any seller who has a combination of negative or neutral feedback and/or item not received complaints that exceed 5% in a 90-day period, would have their seller accounts restricted.  Here is what eBay’s Phillip Justus, VP of Auctions at eBay said about the program:

“Sellers who have demonstrated buyer dissatisfaction rates greater than 5% within a 90-day window are now subject to temporary 14-day restrictions in the form of selling sanctions or reduced listing volume. Sellers with dissatisfaction rates that are 10% or greater are now subject to indefinite restrictions until they improve their buyer dissatisfaction rates to less than 5%. In both cases, sellers are given instructions on how to resolve their open disputes and take other recommended actions to in order to regain their full selling privileges.”

Although this may sound draconian –which it could be for some sellers, Phillip also points out that this policy will only affect the bottom 1% of sellers –and it is these sellers that are responsible for 35% of the negative buying experiences.

My concern is how this will affect the little guy.  I close about 500 auctions in a 90-day period.  So 5% works out to 25 auctions that would have to receive bad feedback to cause me a problem.  But what about the little guy or gal that only launches a few auctions a week.  If you completed 25 auctions within the same period, then 5% would work out to just over 1 complaint to have your account restricted.  If you are a brand new seller and you screw up in your first week or two, will eBay restrict your account –thereby keeping you from even getting started?

So what is a restriction?  As far as I can tell from reading the announcement you will be first required to settle any outstanding issues such as item not received, then you must wait 14 days to start selling again.  An exception is for large sellers, who will not be restricted totally, but will be limited to a unstated percentage of your weekly volume.

So what can sellers do about this?

The obvious answer is to be honest in everything you do and give good customer service so you don’t exceed the threshold. The other obvious thing you can –and should, do is have a second eBay account so you can keep selling while you fix the issues with your main account.

If you are restricted, eBay suggests you also do the following to lift the restriction:

  • Complete all open transactions
  • Review your Detailed Seller Ratings (DSRs) for insights on where there is buyer dissatisfaction. While we are not including DSRs at this time, we will be using them in the future.
  • Settle any open issues with your buyers. You can access disputes in the Dispute Console from My eBay. This includes offering refunds when appropriate.
  • Once all issues are resolved, consider working with past buyers on mutual feedback withdrawal.
  • File Unpaid Item claims  for transactions that received no payment.

I was concerned that eBay would be using the new Detailed Seller Ratings (the Star ratings), but they are not at this time –however I can foresee the day when they will.

Here are some links to pages on eBay that every seller should read:

http://www2.ebay.com/aw/core/200708131050072.html

http://pages.ebay.com/announcements/faq/42.html#question1

The first link in the announcement and the second one is to the eBay FAQ page.

So what is my take on this policy?

In general I support anything that helps get rid of habitually bad sellers.  whenever someone has a bad buying experience they tell other people and this hurts all of us.  I am not sure if this policy is the best way to get rid of poor sellers and I really worry about how new and small sellers will be affected, but I think we have to give this some time.  Making an announcement is nice –but I really think eBay needs to communicate this policy better.  I don’t know if I got the email because I am a PowerSeller –or if every eBay seller got this message.  I hope it is the latter.

I also wish eBay had an exception for new and small sellers who have very few transactions in a 90-day period who could at least get a warning before they are restricted or shut down.  I would hate to see this policy harm people who make honest mistakes, or are victims of unscrupulous buyers and non-paying bidders.

One of the downsides of this is that people will not file a dispute with a non-paying-bidder because they are afraid of getting a retaliatory negative feedback that will restrict their account.

 

 

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