Why you shouldn’t be concerned about eBay’s ‘defect’ rate and how it can have a positive effect

Following on from my last blog post in which I talked about Cassini (if you missed it you can recap here) this appears to have prompted more questions from you regarding technical ‘stuff’ and in particular eBay’s new performance measure for sellers – which includes something called a ‘defect rate’ – and how it will affect you and your business. This new measurement will be included in your evaluations on 20th August – which will come round sooner than you think judging by how fast this year is flying by already!

So, if you haven’t read eBay’s announcement regarding new seller standards then you can do so here

These new seller standards are very clearly customer-service oriented. As you would expect, eBay would like all sellers to have a very low percentage of what they call ‘defective transactions’ for obvious reasons – if a transaction doesn’t go well for a buyer then they may leave negative feedback and decide to buy from other online sites in future instead – which not only hurts eBay but also we sellers – so our job as sellers is to keep our percentage of ‘defective’ transactions below five percent for regular sellers and two percent for Top-Rated Sellers.

The introduction of the ‘defect rate’ is however causing some confusion and worry to sellers – because it’s new, because sellers are concerned that they will start getting ‘defect strikes’ for the wrong reasons and generally because it’s an unknown thing at the moment. But there are positives. So, to help you understand it and so you know what you need to do, I’ve laid out the basics today.

But first up, what exactly is the ‘Defect Rate’?

Well, put simply, it’s basically a measure as a percentage of how often we, as sellers, leave our buyers unsatisfied with the transaction in some way – which I would hope, isn’t very often! So, the more transactions you have without ‘defect’, the less any transactions that do have a ‘defect’ will impact on your seller standards score.

So, when is a transaction ‘defective’?

There are several factors that can count towards a transaction being defective:

1. If you receive a DSR of 1, 2 or 3 for ‘Item as Described’

2. If you receive a return with the reason given as ‘Item Not as Described’

3. If an eBay Money Back Guarantee or PayPal Buyer Protection case is opened with the reason given as ‘item not as described’

None of these three things should happen if you are being honest and descriptive within your listings and include plenty of photographs of the product to ensure your prospective buyers can see exactly what the item is. A buyer should have no reason to return an item citing it as ‘not as described’ if your description is accurate and you have provided what was stated.

I must point out too, that if a protection case is opened and is resolved in your favour then it will not count as a defect.

4. If an eBay Money Back Guarantee or PayPal Buyer Protection case is opened with the reason given as ‘item not received’

Obviously delivery is out of your hands and items sometimes parcels do go missing in the post. But there is no reason to panic that you’ll get a ‘defect’ strike for parcels missing through no fault of your own. If you don’t give an estimated delivery date within your listings, then eBay’s default estimated delivery date is 7 days for domestic and 30 days for international transactions, and a buyer cannot open an ‘item not received’ case until after the estimated delivery date has passed so you don’t need to be concerned about buyers expecting their orders in unrealistic time scales.

Also, just as I mentioned above, if an eBay Money Back Guarantee or PayPal Buyer Protection case is opened for an item not received and is resolved in your favour, this won’t count as a defect.

To ensure you are able to show that you did dispatch a parcel that has subsequently gone missing, get proof of posting from the Post Office or online if you use My Hermes or similar or use a tracked delivery service.

5. If you receive a DSR of 1 for dispatch time

This is simple to avoid! Always dispatch quickly so that your buyer cannot complain about slow dispatch and ensure you mark the order as ‘dispatched’ in your ‘My eBay’ as soon as you have done so. You should aim to dispatch within 1 working day if possible.

6. If you receive Negative or Neutral Feedback

This is avoidable – and worse case scenario you can potentially get negative feedbacks removed in some cases. However, the best way is not to get negatives in the first place! There will come a time when you do unfortunately receive that dreaded red dot, but you can try and protect yourself to some extent by including a note in your dispatched orders briefly stating that you hope the buyer is happy and should there be any problems to please contact you via eBay messages where you will be pleased to resolve any problems quickly and efficiently.

If a buyer leaves positive feedback or no feedback at all eBay assumes that the transaction went well! So even ‘no feedback’ will actually count as a positive transaction with regard to the defect rate which means that transactions are ‘good’ by default and every transaction will help to lower your ‘defect’ rate.

7. If a transaction is cancelled by you due to being out of stock or if the item has been sold to another buyer

This is one to watch! Make sure you are fully stocked at all times and that your listing quantities are correct so that this scenario does not have a chance to happen. If you are out of stock of a product ensure your multi-variation listings reflect this so that a buyer cannot try and order an out of stock item.

If you are keeping your stock levels up to date then the ‘Out of Stock’ option will kick in on your listing automatically and buyers will not be able to inadvertently order. This keeps you safe from having to cancel transactions due to a stock miscalculation.

These are the seven important factors that can affect your ‘defect’ score. Now, I realize that there is the slim possibility of a number of these things all happening at the same time with one buyer!

For example, if a buyer purchases an item that is out of stock, then opens a case because their order is not received and then to top it all, leaves you negative feedback. That’s in effect 3 ‘defects’. But, don’t panic – this will only count as 1 defect against you – not 3 – because it’s one buyer.

Overall, the new ‘defect’ rate shouldn’t affect you or your business in a negative way – indeed there are positives to this as I’ve explained.

So, the basic idea here is the same in all cases: simply keep your customer service tip-top, your listing descriptions accurate, your dispatch times fast, your stock up to date and communicate well. Every one of these things will allow you to avoid upsetting your customers.

As always I wish you the best of success,