Subsequently, the electrician platform responded to the consumer's response and escaped “your account temporarily does not meet the requirements for the use of freight charges” “recommends that the short-term static account reduce the rate of return”。
Platform response
Closing freight risk reduces business losses
In 2008, the first of these was “seven days without reason” for returning goods, and in 2010, it was also a treasure hunt, introducing freight risk, and then the “infinite powder” exercise was studied by various electrician platforms as a standard. With a combination of “seven days without justification” and “freight insurance”, consumers can not only retreat but also safely and freely, since in most scenarios freight insurance is carried by commercial carriers. As a result, psychological barriers to the return of goods for exchange were almost completely eliminated and became a regular feature of internet purchases。
After more than a decade of development, the problems posed by this kind of risk are becoming more and more evident - for merchants, the increase in the return rate increases operating costs in the intangible; for insurance companies, there is a high recovery rate and the risk of being deceived。
Journalists found that a number of businesses had indicated on social platforms that since late august, their shops had voluntarily closed their freight insurance services。
Zhang yana, an electric operator, claims that, from a commercial point of view, the introduction of a “freight risk” service increases the cost of premiums per piece by about five dollars, which would be “unprofitable” if the return rate was too high. According to zhang yana, “the freight insurance that had previously averaged $5 per unit is more expensive than the delivery fee, and with regard to the delivery fee, if it is large, talking to the express delivery company could be $34,000 nationwide. At first, the volume of return insurance increased, but the return rate increased, followed by an increase in stocks, which became uncontrollable.”
Electronic operators described the process of conducting their own online tests: selecting some customers to support “freight insurance” and turning off the “freight insurance”. The results showed a decrease in post-sales disputes and operational costs, accompanied by a decrease in refund rates of about 10 per cent. In other words, for commercials, the closure of freight insurance services itself can screen out a random list of consumers。
One of shenzhen’s electricity vendors stated that, while some of the items with a low rate of return were subject to freight risk of less than $1 a dollar, the average cost of the goods that were regularly returned was $3. The more goods were returned, the higher the premium, the higher the cost of the insurance, and the higher the cost of shipping the store’s gift. “although buying freight for consumers would indeed be helpful in terms of sales, the costs of operating the store would also increase if it encountered a malicious ‘shell’ team.”
There is a risk of “freight”
Indeed, the law had been violated in the case of malicious profit-making through freight charges. Public information published by the courts and the police indicates that there have been numerous cases of freight-risk fraud throughout the country, including the opening of freight-risk functions by individual registered shops, the creation of false transactions and logistics orders, the fraudulent collection of freight-risk insurance, and the collection of refunds by groups using the mechanism of freight-risk insurance. Since the beginning of this year, public security in many places has uncovered cases of fraud in the payment of “freight insurance” claims, of which some have fraudulently claimed over $1 million in eight months。
The “freight insurance” rate is also higher than that of other products from the insurance company's perspective. It is known that the rate of compensation for freight on an electrical platform is around 80 per cent. A senior insurance practitioner introduced: “this risk is largely non-profit, mainly for two reasons: the high frequency of the return of goods and the risk of moral fraud such as wool from insurance companies.”
Under-secretary-general song jingjun of the china institute of insurance of the beijing university of commerce and industry believes that, in addition to increasing the impact of electric power platforms, insurance companies can also address the root causes of the problem by changing the way payments are made. The song jing jun further explained that, in practice, “freight-risk wool” occurs more often when consumers freely choose to send mail, which ultimately does not match the offer for couriers with the insurance company's pricing. This can be effectively circumvented by a uniform procurement of third-party services by insurance companies, or by enhanced regulation of large-scale return of goods by electric power platforms。
It is understood that there are existing platforms that have introduced measures to reduce commercial freight risk, such as simplified return-for-carriage steps, the determination of unusual accounts, increased preferential subsidies and lower freight-risk prices, to address current problems。
