NEW DELHI: Flipkart has revised its return policy , narrowing the window when a customer can send back a product bought on its website to 10 days from the previous 30 on most top-selling products. The leader of India’s ecommerce space also told sellers on the platform that they will have to pay higher commissions from June 20.
The no-questions-asked return policy followed by ecommerce firms has led to a logistical nightmare and additional operational expenses for sellers on online marketplaces as they have to pay for the return shipping.
The shortened return period is likely to address, at least to some extent, this concern of sellers and help Flipkart attract more to sell on its platform.
But the move to levy higher commission is an attempt to turn a profit that eludes most of India’s top ecommerce firms. Rival Amazon, too, recently increased seller commissions.
Sellers said the revised policy will increase product prices on the Flipkart platform by about 9%. The new return policy will apply on categories such as electronics, books and mobile phones, which form the bulk of the sales on Flipkart.
The 30-day return policy will remain only for clothing, footwear, watches and eyewear, jewellery and fashion accessories, as well as large appliances. “The impact of this change should come into effect from July,” the company said in a communication to sellers.
“The revised structure across shipping, commission and returns will enable sellers to have predictability and better manage their online business,” a Flipkart spokesperson said in an emailed response to ET’s questions.
“The standardisation has been designed to encourage sellers who offer superior customer experience, and is thus a win-win for both our customers as well as our customer oriented sellers,” the spokesperson said.
“Our commission and fee structure remains competitive and in many categories better than other marketplaces. Flipkart is closely working with all our sellers to ensure a smooth transition.”
The company has different rates of commission based on the category and sub-category of products. The spokesperson didn’t say how much will the commissions go up.
Flipkart is also discontinuing the Zero+ Commission Policy. Under this policy, which it introduced recently, it had stopped charging commission from certain groups of sellers, instead asking them to advertise on its platform for a fee. This policy also barred sellers from charging shipping fee from customers.
Terming the Zero+ Commission Policy as “complex”, the company’s communication to sellers said the revised policy “will have the new fees structure which is simple and easy to understand”. The sellers will be allowed to pass on shipping cost to customers.
Sellers, meanwhile, said while they can pass on one side of the shipping cost to the customer, they will still have to bear the burden of reverse logistics in case of returns made by buyers as the platform does not seek sellers’ approval while accepting a return request from the customer.
“Some buyers make unreasonable returns when they change their mind post-delivery,” said a seller. According to this person, some marketplaces such as Amazon seek sellers approval before accepting a return.
A spokesperson for the All India Vendors’ Association (AIOVA) said the new Flipkart policy will impact the prices of products sold on the platform. “Flipkart has made many products and categories unviable for a common seller. They are still not taking inputs on customer returns, and due to new policy, cost of doing business will rise as they will charge reverse shipping fees from sellers. Sellers will have to increase current prices by 9% approximately.”
AIOVA is a group of 1,000 sellers across all online marketplaces. Sellers also said instead of simplifying the process, as the company claims, it complicated the matter further. For them, frequent changes in policy is another concern.
“Flipkart is changing its policies very frequently. In December 2015 it introduced the Zero Commission Policy which had to be retracted within a two months of being launched. It then started the Zero+ Commission Policy in early 2016. Within less than six months that has also been changed. This makes reconciliation difficult as it is not easy to keep track of so many transactions,” a seller on Flipkart said without wanting to be identified.