What exactly is a Restocking Fee?

[all4scuba05]

I didn't want to hijack this thread. http://www.scubaboard.com/forums/ba...06134-questionable-lds-behavior-policies.html

This is what I mean.
Let's say I buy an HID canister/light. $1200. I return it and they charge me 10% restocking fee. That's $120.
I also return a $45 hood. That's $4.40 in restocking fee.(10%)

If they can restock one item at a cost of $4.40, why does it cost $120 to restock the other item?

What exactly are they getting paid so much for? Why can't it just be a flat fee for restocking?

 

[Paco]

Good question.

 

[spectrum]

I would say that part of it is risk management.

I say go ahead and ship it back and I will charge you X as a restocking fee. You may send it back in a pristine unopened perfectly ready for resale package and I'm golden or the package may be obviously disturbed or otherwise not quite like new despite your best care. In the later case I may have a hard time getting top dollar.

Meanwhile since I sold that item I ordered replacement stock and now I have an overstock and I'm tying up cash with excess inventory.

As you can see this can have some negative effects on a small or even a large business.

Some online sellers embrace the model of sending 3 sizes and you keep the best fit. Others are not in a position to float that kind of inventory and feel the need to put some of the onus on the buyer.

Some also get abused by contingency purchases. I can't think of a perfect scuba example so here is something unrelated. There is a hurricane coming and I am worried about loosing electrical power. I head to the hardware store and buy a generator. The storm passes and the generator was never needed and is still in the box. The morning after I return it. The store sold out of generators at the height of the storm when people really needed them but 1/2 of the sold units were returned unused. Had they all been bought with sincerity they would have all gone into service as permanent sales. The knowledge of a restocking fee can manage some of this behavior.

The fee is for far more than unpacking it an placing it back on the stockroom shelf. Once upon a time I was in retail.

Pete

 

[GeorgeC]

Restocking fee mean “Find another dealer. SCUBA or not!. There is too much competition to worry about restocking fees.

Take Spectrum’s quote “I say go ahead and ship it back and I will charge you X as a restocking fee. You may send it back in a pristine unopened perfectly ready for resale package and I'm golden or the package may be obviously disturbed or otherwise not quite like new despite your best care. In the later case I may have a hard time getting top dollar.”

OK so I am the guy who sent it back in pristine condition. I should be penalized the 10% for returning it? I don’t have a problem with the store calling you and saying “You left the instructions out or you cut the box open with a knife and I need to charge you for less than pristine condition.

 

[all4scuba05]

There are two questions then to keep in mind.

Should restocking fees be charged?

Should restocking fees be by % or by a flat fee.?

 

[Hoyden]

In all likelyhood you charged the item and will want the refund placed back on your credit card. Small businesses pay transaction fees and a percentage on both of those transactions. As Spectrum mentioned above, for a small business, returns can create inventory management problems. Those are the two big reasons for restocking fees.

 

[all4scuba05]

Ok. A store has 10 generators. A storm is forcasted. He's happy because now he's going to sell all 10 at $1000 each. The generators are now sold. That's $10,000 made.

Oh Oh. 5 customers returned theirs. "Looks like I'm only going to make $5000 form this storm." Well I'm going to charge them money for my taking the generator from the service desk to the shelf, and I'll call it a restocking fee. So now I can make $500 from the guys who decided to return their generators.

If the storm was never forcasted and never came, $0 would have been made. Yet because of the forcast he made $5000 when all was said and done. Greed or anger made him want another $500.

That's the way I see it.

 

[miketsp]

Well I have on occasion purchased equipment at a discount (in the USA) just because it had a label on it saying "returned" or "refurbished". The shop owner explained that a client took it away from the shop and apparently returned it in pristine condition and it had been inspected/tested but there was a slightly higher risk of it having a defect because it had been opened. However any defect would be covered by their warranty.

However if I'm a tourist on a short duration trip in the USA, that may be a risk I'm not willing to accept.

 

[1_T_Submariner]

As long as they spelled this out before you purchased than you should have known better. Some items are now used once they have left the store other items like your generator example if the 5 people return them but the store owner has already ordered the 10 to replace the original he could have to pay interest on the money invested to keep the extra 5 generators. Buisnesses are in buisness to make a profit, not friends.

 

[all4scuba05]

Buisnesses are in buisness to make a profit, not friends.

True. It's too bad then when an LDS thinks that way, they LOSE money because they lose customers.

In the other thread, it was mentioned that Scubapro doesn't charge restock fees. If you had the shop order a BC size that the shop doesn't stock, and then you return it because it doesn't fit, and the LDS says you have to pay a restocking fee of $65...I would think that one of the 2 are greedy.