Comments on: Freight and warehouse chargebacks

By: Kathleen

Kathleen — Tue, 16 Jan 2007 23:49:01 +0000

I wrote numerous orders for one buyer last Fall, however, the buyer is wanting to return some of the goods since certain styles did not sell. Is this common?…I was thinking since the orders were not made as some kind of consignment agreement, nor was there any kind of sell-thru guarantee made, the buyer would have to assume the risk on all of the styles that got ordered.

You’re too nice Andy. You need to trust your gut more. No, you should not take the goods back in the absence of any agreement. You can be nice but firm, stick to your guns.

By: andy

andy — Mon, 15 Jan 2007 19:33:43 +0000

Can anyone shed some more light on chargebacks/returns for unsold merchandise? As a new DE, I wrote numerous orders for one buyer last Fall, however, the buyer is wanting to return some of the goods since certain styles did not sell. Is this common?

Perhaps naively, I was thinking since the orders were not made as some kind of consignment agreement, nor was there any kind of sell-thru guarantee made, the buyer would have to assume the risk on all of the styles that got ordered.

By: another wish

another wish — Sat, 19 Aug 2006 00:41:35 +0000

yes, i, too, deal with a Clothing Store that charges back for things that go on sale.

*sigh* is right.

By: Esther

Esther — Fri, 18 Aug 2006 17:44:00 +0000

J.C., you’re right. Charging back for unsold merchandise is the same as guaranteeing sales, except without the benefit of signing an agreement beforehand. I have seen a lot of sneaky chargebacks slip through. Most retailers are upfront about charges, but there are those few that are not.

By: J C Sprowls

J C Sprowls — Fri, 18 Aug 2006 15:13:42 +0000

Esther,

You mention that some retailers will chargeback based on unsold merchandise. Isn’t that the same thing as guaranteeing their order will sell-through?

Umm… whose order is it? *sigh*

Do I, as a manufacturer, get to counter offer their “chargeback for unsold mdse” penalty w/ a “30% f/end load to manage their mistakes” fee?

By: Thomas Cunningham

Thomas Cunningham — Fri, 18 Aug 2006 03:14:06 +0000

am going through this with my first shipment to major retailer right now — you haven’t even mentioned EDI yet.

By: Esther

Esther — Thu, 17 Aug 2006 23:04:29 +0000

When I worked with a company that sold to the Big Box guys, we had two logistics people to handle packing and shipping details – one over the packing, the second to coordinate with various carriers. It is the responsibility of the manufacturer to obtain, read, study, and implement the packing and shipping specs from the retailer. This includes quality inspections of printing labels, hang tag placement, etc. And believe me this can easily become a full time job if you deal with several big box retailers.

This list doesn’t seem too bad, but it is easy to see how quickly the charges can add up. An unreasonable charge would be one that was not included on the specifications. A rule change in the middle of order fulfillment can be considered unreasonable. I have seen chargebacks for additional items like unsold merchandise and store promotions.