Ever since its inception in 2005, Etsy has become a top marketplace for selling products, attracting a large user base from around the world. Etsy is known for its unparalleled selection of one-of-a-kind products, with an incredible community of over 7 million active sellers. However, as sellers who just start selling on Etsy, you also have many risks.
- What is Etsy purchase protection for sellers?
- How does Etsy seller protection work?
- How to avoid paying out for an Etsy purchase protection claim?
If you are a seller on this best-selling platform, this article is a must-read resource for you.
What is Etsy Purchase Protection for Sellers?
Etsy prioritizes creating a safe and inclusive platform for Etsy sellers to conduct their business. Recognizing the challenges small businesses face, Etsy introduced Etsy Seller Protection in August 2022. This policy aims to provide peace of mind to sellers by refunding buyers in case of order disputes. The policy specifically covers three main circumstances to minimize risks for Etsy sellers:
- The package fails to reach the buyer, such as when it gets lost during transit.
- The item arrives damaged (it is limited to one occurrence per calendar year)
- The customer disputes that the item does not match its listing description despite it being accurate as listed.
While the program assists with unexpected costs, Etsy emphasizes that it is not an insurance policy. Therefore, it is recommended for Etsy sellers to obtain separate eCommerce insurance to ensure comprehensive coverage for all potential scenarios. You can consider how much does it cost to start an Etsy shop to pick the right eCommerce insurance for your business.
Plus, Etsy has implemented certain conditions that significantly restrict the policy’s scope.
As an Etsy seller, you might also want to read: 8+ Etsy Prohibited Items: Things to Know Before You Sell
How does Etsy Seller Protection Work?
If you wonder Is selling on Etsy worth it? Etsy Seller Protection might be your answer. With this program, Etsy provides refund coverage for Etsy sellers in certain dispute situations. This guide will explain how Etsy’s protection program functions, including the circumstances covered and conditions sellers need to be aware of.
How to qualify for Etsy seller protection?
Etsy Purchase Protection offers automatic coverage for qualifying orders without requiring any setup from the seller. The process begins when a buyer contacts you through a Help request or opens a case regarding the order. Etsy will then review the order and determine if it meets the criteria for Purchase Protection.
If the order is eligible, the buyer will receive a refund while you retain your sales earnings.
Some cases will close automatically when the matter is resolved or when the buyer is happy with the solution. There are specific events that trigger automatic case closure, including:
- When a full refund is issued to the buyer through Etsy Payments.
- When the buyer is satisfied with the resolution of the case and chooses to close it.
Etsy Seller Protection requires additional information to resolve an open case, and they may contact you. It’s crucial to respond promptly within the given timeframe. In situations where you need to issue a full refund to buyers who made payment through PayPal instead of Etsy Payments, you must furnish Etsy with evidence of the PayPal refund before the case can be officially closed.
What is Etsy seller protection policy?
To guarantee that Etsy Seller Protection protects you and increases your chances of winning any cases opened against you, it is important to take the following factors into account:
- Cover the refund cost for orders up to $250 (including shipping, Etsy sales taxes, or any other taxes) through Etsy, relieving the seller of that responsibility.
- Purchase an Etsy shipping label or provide Esty with a valid tracking.
- Utilize Etsy Payments as the payment method (but not all countries can use Etsy Payments).
- Ship the order exclusively to the location provided on Etsy. Be cautious when dealing with alternative shipping addresses received via Messages to avoid potential fraud or scams.
- Take meticulous care in packaging the order to ensure it arrives intact and undamaged during transit.
- Clearly state the processing times on your listing and diligently adhere to those specified times. Don’t forget to include an Estimated Delivery Date (EDD) in each listing that transit times and, where applicable, the zip code. Remember that any informal agreements made via Etsy Messages to alter the shipping date will not be considered valid, as the ship-by date is determined solely by the processing times specified for each listing.
- Note down all of your Shop Policies in your listing, encompassing policies for returns, exchanges, and custom orders. Ensure that these policies align with Etsy seller rules and local regulations.
- Maintain a positive standing for your shop by adhering to all of Etsy’s policies and guidelines, thereby upholding a trustworthy and reliable reputation.
For orders that fulfill these criteria, etsy purchase protection will assume responsibility for covering the refund costs instead of the seller. Conversely, sellers are accountable for refunding expenses associated with orders not meeting these requirements.
How to Avoid Paying Out for an Etsy Purchase Protection Claim?
Even if you take all the necessary steps correctly, there may still be instances where the order does not qualify for Etsy Seller Protection. However, several common factors contribute to whether Etsy merchants triumph or lose in terms of seller protection and not all of them are widely known. The following suggestions are considered to be the most effective approaches.
1. Put disclaimers and terms of sale in the listing description
Sellers generally cannot create lengthy shop policy pages anymore, but in certain cases, conditions & terms encompass the product description.
For instance, statements like “handmade items may have slight differences” have been used by Etsy Seller Protection Support to resolve seller-friendly outcomes in NAD disputes. This is particularly applicable when the item is customized for the buyer, as indicated by the personalization option.
However, any additional text should adhere to Etsy’s regulations and be lawful in the jurisdictions of both the seller and the buyer. Furthermore, it’s crucial to specify that the item may not perfectly match the image provided unless it indeed does.
For a more detailed guide, you can refer to our article how to set Etsy return policy to learn more tips.
2. Pack orders securely and ship them on time
To avoid any case about shipping or packaging, you should prioritize secure packaging and timely shipping. Choosing the appropriate packaging materials, cushioning fragile items, and sealing packages securely can help you safeguard products from damage during transit. Don’t forget to include clear labels, accurate addressing, and tracking information to enhance transparency and ease of tracking for customers.
After packing your products, the parcel should enter the postal system or be handed over to your chosen shipping provider on the date indicated on the label. This delivery day must not exceed the processing time specified for the order. Suppose you are unable to dispatch the order by the final day of the processing period. In that case, you are obligated to either officially extend the processing time via the Orders page or cancel the order.
Failing to adhere to this requirement can lead to various complications, including the potential for a permanent Etsy account suspended of all a seller’s shops and the loss of Etsy Seller Protection.
3. Accurate listing description
Some sellers have overlooked adding an estimated delivery date to custom or private listings, leading to potential issues. It is advisable to regularly check that all your listings still have processing times specified. In cases where shipping profiles are used instead of calculated shipping for Etsy Seller Protection policy, it is crucial to modify the delivery estimates appropriately. This becomes particularly important when facing issues with the shipping carrier or when the automated estimates are unrealistic.
Implementing this approach can aid in reducing claims from impatient buyers who expect overnight delivery from distant locations. This is because buyers generally cannot open a late delivery case until after the estimated delivery time has elapsed.
4. Offer prompt customer service
You should respond promptly in the case log when a case is opened. Keep your response concise and focused, as the staff reviewing cases may have limited time for each one.
You can highlight the steps you have taken correctly, particularly any efforts made to assist the buyer. Refer to relevant sections of your shop policies or listing that support your position, but refrain from commenting negatively about the customer. For instance, even if it is true, avoid stating “they’re a scammer” in this case. If the buyer claims they did not receive the package but has already shared multiple photos of the item on social media, calmly mention this fact and allow Etsy seller protection lost package staff to draw their own conclusions.
5. Use Etsy seller insurance
Sellers are accountable for refunding costs associated with orders that do not meet these eligible requirements, exceed the $250 threshold (including shipping and taxes), or sustain damage during transit after the initial case covered by Etsy. To address these concerns, Etsy strongly advises sellers to consider purchasing Etsy seller insurance when fulfilling orders.
In certain circumstances, exploring alternative eCommerce insurance options such as U-PIC may be beneficial, which provides coverage for parcels that go missing during transit. If a seller has obtained third-party insurance or has coverage through a carrier or payment processor, Etsy will request that they file a claim with their primary coverage first. Etsy retains the right to process a refund only in cases where other forms of coverage do not apply.
5. Appeal cases, if possible
When you face a loss in a case, and the Etsy Purchase Protection Program initiates a refund from your payment account or credit card, it is still possible to appeal the result. While the appeal page says it is for “Not as Described” NAD and damage claims only, go ahead and use it whenever the decision seems wrong.
For instance, in the scenario above where Etsy’s automated system incorrectly indicated a late shipment despite it being dispatched on the correct day, it would be appropriate to file an appeal using this method. Similarly, delayed delivery caused by adverse weather conditions or carrier errors should also be subject to appeal.
It is important to appeal any situation where Etsy did not adhere to its own legal policies, such as when a buyer returns an item without obtaining prior agreement from the shop. When submitting an appeal, clearly state the primary reason for the appeal, preferably using Etsy Purchase Protection‘s terminology.
UPDATE (May 7, 2023): If you find that Etsy fails to comprehend your appeal, now you can reach out to Etsy directly via phone or live chat.
Etsy Purchase Protection – FAQs
- What does Seller Protection Etsy mean?
The Etsy Seller Protection Program is designed to protect sellers on the platform. Under this protection, Etsy may provide refunds to buyers while allowing sellers to retain their earnings in the following situations:
- If a buyer does not receive their package, such as when it gets lost during transit.
- If the item arrives damaged (limited to the first occurrence per calendar year).
- If the item is accurately listed in the description, but a buyer disputes its accuracy.
- How to use Etsy Seller Protection?
Etsy sellers are automatically enrolled in the policy without any additional cost. However, to successfully file a claim under the Etsy Seller Protection policy, sellers must meet certain criteria and fulfill specific requirements.
- How to open a case on Etsy as a seller?
If you wonder how to file a claim on Etsy, sadly, it is a “No” for sellers. Sellers are unable to open cases against buyers for issues such as items not being sent, items not arriving, or items not being described.
Conclusion
To wrap up, if you are about to become an Etsy seller, rest assured that Etsy Seller Protection will provide you with a secure platform. This policy will offer refund support for order disputes if eligible, ensuring a positive experience for all parties involved. With the Etsy Seller Protection program, you can confidently start your business with Etsy and focus on growing your business with peace of mind.
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