Should customers be charged extra costs when they change the address after shipping?
Asked 5 years ago
Eugene Greene
Friday, July 19, 2019
It’s a question of your business economics and branding. For example: • How much is your CAC? • How much is your customer LTV? • How much does it cost to re-ship the order? • How much does it cost to ship a new order instead of the one that was lost? • How much is a happy customer worth (think of positive reviews, referrals, etc.)? If you talk about blame, then the customer should probably pay, but there’s a reason why we say that the customer is always right. If you eat the cost of sending out a new order, it’ll probably pay off in the long run. Because it’s usually more expensive to acquire a new customer than to returning customers, and it’s often more costly to repair your brand identity than to make your customer happy. ******************************* You can adjust your prices to cover the costs of lost orders. Here’s an example of the math I use: My average shipping cost is $20 If I re-ship the order, I lose $20. On average, I need to re-ship 1.5% of my orders. So: 1.5% x $20 = $0.3 I increased the price on all of my orders by $0.3 and covered the costs of re-shipping orders. ******************************* People appreciate excellent customer support, which makes them return to buy again and recommend your business. Besides that, if you decide to charge the customer and they’re angry, they can cancel the order or open a chargeback. Then you’ll lose the money and have a bad reputation.
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