Selling to the EU? Potential Problems for Parts Retailers
You may be surprised to learn that the EU regulates return polices for online retailers who sell to EU residents…even if the retailer is in North America!
Here’s what North American auto parts retailers need to know about selling parts to the EU.
Crazy EU Return Policies and The Problems They Can Cause
The long and short of it is this: Customers who live in the EU and buy parts from your website may expect that they can return or cancel any order they’ve made from you, regardless of the reason, for up to two whole weeks after receiving their parts. That’s because online retailers in the EU are required to adhere to this rule.
What’s more, EU customers may expect that they can return whatever they buy online to you at no cost, expecting a full refund for the cost of their order AND the cost of return postage. Again, this is because the EU has banned restocking fees. EU residents may expect this treatment from whatever website they do business with, even a website that’s on the other side of the world.
Indeed, if you’re a worldwide retailer and you sell directly to an EU customer, you may be compelled to abide by these wacky EU return laws. Failure to do so could result in issues with receiving payment, fines, or worse…the consequences aren’t well known at this time, at least not to us, and there’s not much information to go on from the US Chamber of Commerce, Export.gov, etc.
Why US and Canadian Auto Parts Retailers Need to Take Note
While these EU return policy rules are bothersome to any retailer, they are particularly troubling to auto parts retailers who often can’t accept returns, and/or must charge significant restocking fees. Not to mention, return postage costs can easily dwarf the gross profit margin on the part sold.
So what’s a US or Canadian ecommerce parts retailer to do? There are a few options:
- State in no uncertain terms that you will not accept returns from EU customers, regardless of EU law. While it’s never a good idea to flaunt any country’s laws, many North American retailers aren’t concerned about meeting EU rules and regulations.
- Additionally, by telling EU customers up-front that they will not get the same treatment from your company that they get from retailers in their home country, you will likely preempt some problems, even if you decide to follow EU law when push comes to shove.
- Inflate shipping and handling charges to customers in the EU, which will help cover the cost of returns you process.
- Refuse to sell parts to EU residents.
Unless your company does a lot of business with customers in the EU, odds are good that you can refuse to sell to customers in Europe and/or ignore the EU’s return laws with minimal consequences. However, if you’re shipping parts to the EU in substantial quantities, it’s a good idea to evaluate your risks, charge shipping and handling fees accordingly, and consult with the local U.S. Export Assistance Center in your area (you can find a directory of these centers here).
Again, we must stress that flaunting EU return regulations could be a dangerous business decision. It’s hard to know what the consequences could be for a US ecommerce retailer that blatantly disregards EU regulations while selling to EU residents. So…ignore these rules at your own risk, and please don’t construe our blog post as legal advice.
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