As soon as you start making some sales you’ll get disputes on PayPal, refund requests per email and some chargebacks.
A refund is when you agree to send the money back to your customer because the customer was unhappy, the item never arrived, the item was broken or something else happened. With refunds, you willingly send back the money because it seems appropriate and right.
However, a chargeback is something very different.
A chargeback is when your customer goes to his or her bank and asks them to take back the money from you. In this case the bank will “force” your payment gateway to hold the money. You will have to submit additional information like receipts, email transactions and other proof to the bank of the customer. And in most cases you won’t win those chargeback disputes anyway, so it’s a waste of time.
The downside of chargebacks is that the payment gateway will charge you an additional fee. So not only will the money be taken from you unwillingly, but you also have to pay an additional fee.
So with chargebacks you loose money and there’s not much you can do about it. Sometimes chargebacks happen because of fraud. Or maybe because the customer doesn’t recognise the statement on the credit card bill and thinks it’s a fraudulent payment.
Whenever I get a dispute or a chargeback for a small amount of money, I just refund and close the dispute. In this way I avoid any headache and stress and focus again on growing my business.
It’s easy to get worked up and angry when facing refunds, but it’s important not to get sucked into it.
These small losses are insignificant in the greater picture.
If you get lost and emotionally attached, your business will suffer because it pulls you away from your primary objective which is producing income, making more sales and growing your business.
However, if I get a dispute or a chargeback for a larger sum of money I am more likely to fight for it and win the dispute. It always depends on the particular product, the refund policy for that product and the custom I’m dealing with. In many cases you can resolve disputes with good customer support and by giving a replacement product.
So the bottom line here is: You will get disputes, refund requests and chargebacks in any type of business or e-commerce online store.
The key is to stay positive and focus on things that matter.
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[…] you can also create a refund policy that states the allowed buyer protection period for your own store. For example: “You are […]
fanny
i thinkes i am the victim here. i run a dropshipping business. but the customer just doesnot want to wait until the estimated delivery time.
he already received 1 item. and still waiting for the next 1 item.
he chargeback.
what should i do now?