How to reduce paypal refunds for my business

7 replies
  • |
Hello WF family, I recently started a online/offline aftermarket shoe business to create a start up funds for my main business goal so this will be a small time gig. The products come from china and take 3-4wks to be delivered.

My target audience will be high school males and some college students, age 14-22. Once i earn like $1,000 to $2,000 I will put on the back burner and focus on high earning business goals. I will deliver products in safe locations. I plan to market this site by passing out small flyers on high school campuses since i know they are ripe for this particular product and also on buy/sell location based apps. I once was a target persona for this niche a few years ago and have younger brothers know in this niche.

Most of the kids in this age group don't have debit cards. Due to this fact and my goals for this service, I intend to take cash payments to reach my short term goal. I also plan to pass this on to my younger brother who is 19yrs old. He can serve most of his old classmates/fb friends etc.

An older friend told me I should not take no cash payments at all. That all payments should be made from site. Then I could deliver them locally afterwards. My main purpose for the website in the first place was to display the shoes and sell from the location based buy/sell apps. I came to the decision that I will accept $30 down payment to guarantee product within 3-4wks which will go towards product purchase. Then and maybe then stock up on inventory but since my real goal is just $1-2k I don't think that should go that route. I will make like $50-$60 ROI per product.

My question is if I took the advice and decided to accept only payments online no dropshipping, how could i go about preventing refunds after i delivered the product to the customer. If i went that route based on the info above, it would look something like this:

Accept $30 online for non-refundable down payment(I don't even know if this is possible with paypal)

Pay the rest to order the product.

Product comes in 3-4wks

Customer pays remaining balance on paypal(by receiving my link)

Next day customer could ask for refund via paypal and possibly.

The reason why i didn't want to use paypal and accept only cash was due to refunds, and paypal fees.

Due to my goals, what do you think will be the best option?
#business #paypal #reduce #refunds
Avatar of Unregistered
  • Profile picture of the author dave_hermansen
    Sure there are a few frauds out there but you can't let that relatively small portion of the population stop you. You prevent refunds by supplying a product that nobody would ever want to return.

    You definitely have to take online payments. Cash will never work in this scenario, If you are really worried about fraud, get a real payment processor (not just PayPal) and sign up with a service like NoFraud that will take a 1/2 percent fee for guaranteeing all orders against fraud.
    Signature - FREE TRAINING - Learn How to Build Your Own eCommerce Website
    My PROVEN ecommerce process, as seen on: Fox Business News, the NY Times & Flippa
    {{ DiscussionBoard.errors[11205822].message }}
  • Profile picture of the author MValmont
    I absolutely hate Paypal, because in my opinion they have too much power, and their customer service is the worst ever.

    For e-commerce I use Stripe and I absolutely love them and I've never had any problems with them (so far).
    {{ DiscussionBoard.errors[11206033].message }}
    • Profile picture of the author salustio
      MValmont, ¿do you only use Stripe?. ¿Have you removed Paypal from your sites?.
      {{ DiscussionBoard.errors[11206330].message }}
  • Profile picture of the author JAIDEEP2959
    You can sell at lower price for reducing dissatisfaction of customers and reducing refunds.
    {{ DiscussionBoard.errors[11206274].message }}
  • Profile picture of the author dave_hermansen
    We use both PayPal and Stripe on most of our sites. It's good to offer people options, since some people only want to pay with PayPal and other refuse to pay with PayPal.
    Signature - FREE TRAINING - Learn How to Build Your Own eCommerce Website
    My PROVEN ecommerce process, as seen on: Fox Business News, the NY Times & Flippa
    {{ DiscussionBoard.errors[11206533].message }}
  • Profile picture of the author mikec2010
    If you want to go big, you need to accept credit card payment because that is how most people transacts only.

    In order to reduce fraud, you can setup fraud screening service such as FraudLabs Pro and let them to assist you in reviewing all credit card orders.

    Chargeback occurs in all merchants, it should not limit your business. You should manage risk using all resources available online.
    {{ DiscussionBoard.errors[11231565].message }}
  • Profile picture of the author sunpeaks589
    I will give you Good suggestion that you must try to cut down your time period and update that within given time before recieve no refund applicable which help to cut down the refund mode
    {{ DiscussionBoard.errors[11231587].message }}
Avatar of Unregistered

Trending Topics