Missing packages are a fact of life in eCommerce. While many parcels are lost every day within the carriers’ networks (sometimes temporarily and sometimes for good), it’s especially perplexing when a “delivered” package (per tracking) is reported as missing by the customer.

So, what happened?

In such a case, one of four things is likely to have occurred:

  • The package was received by someone else at the destination
  • The carrier made a mistake and delivered it to a neighbor
  • The package was stolen
  • The customer is being dishonest

Who is responsible?

Regardless of where the package may be, parcel carriers will rarely take responsibility after they have marked it as “delivered” — from their perspective, it was, after all, delivered. Of course, it is possible that the carrier made a mistake and left the package in the wrong place; however, it is also possible — and, in fact, very likely — that the package was either stolen, received by someone else at the destination (who then perhaps set it aside), or received by a customer who simply wants to work the system to see what he or she can get for free.

What options does a seller have? 

This scenario puts the seller in an awkward place because blame really can’t be shifted to the customer — and the carriers will almost never agree to be held responsible. 

Sellers, therefore, must either:

  • Reship the order for free
  • Refund the customer’s payment, or
  • Refuse to reship the order or refund the payment

If the seller refuses to reship the missing parcel and/or refund the customer, a chargeback is likely; however, because the third-party carrier shows the package as having been delivered, a favorable outcome is certainly possible. That said, sellers are likely to face negative backlash from customers who have paid and yet not received what they ordered.

What are best practices?

At IronLinx, most of our clients generally elect to reship for free and/or refund a customer’s money — often after requesting that the intended recipient first check with others in the household, immediate neighbors, etc.

Are signature service or insurance options helpful?

Not really. Signature service may eliminate some problematic instances (though it really doesn’t guard against theft, things being received and misplaced by non-intended recipients, etc), but the cost per parcel would likely be way too high to be justified. As for insurance, most offerings only cover packages lost in transit — thereby disqualifying anything marked by the carrier as delivered.

Conclusion

On the whole, the cost of lost packages needs to be worked into a seller’s overall pricing model. Though none of the situations described above are in any way the fault of the seller, the reality is that sellers have little choice but to shoulder the burden of making affected customers whole on their own.