What's a fair way to handle things if the goods don't show up?

[FreeTrade]

Imagine the following scenario on an eBay-like BTC site.

Seller lists item for sale on site.

Buyer purchases item and sends site BTC to hold in escrow.

A month passes, buyer complains the item didn't show up. Seller insists he sent it, but has no proof of dispatch.

What to do with funds in escrow?

What's a fair policy to handle this.

[bulanula]

Nice idea to think about.

[deuxmill]

Imagine the following scenario on an eBay-like BTC site.

Seller lists item for sale on site.

Buyer purchases item and sends site BTC to hold in escrow.

A month passes, buyer complains the item didn't show up. Seller insists he sent it, but has no proof of dispatch.

What to do with funds in escrow?

What's a fair policy to handle this.

Weal .. no proof of dispatch? Then maybe no dispatch ? => Money back to buyer ?

Proof of dispatch ? => money to seller ?

No?

But the truth is the problem is far more complicated.

For example the  escrow can't know for example if the dispatched item is of the quality that it was portrayed in the listing. or even if the dispatched item is the item listed . The only real solution would be to dispatch it to thought the escrow which raises costs.

The answer is no escrow let people get burned and the genuine will raise to the top. 

[edd]

There's no way for the buyer to prove that the item wasn't received. In this case, the seller is making the claim, "I sent it" so the burden of proof lies upon the seller.

[FreeTrade]

Weal .. no proof of dispatch? Then maybe no dispatch ? => Money back to buyer ?

Proof of dispatch ? => money to seller ?

Thanks for the reply, I think this escrow policy does deal with the basic, and probably the most prevalent scams - ones where the seller doesn't have, or doesn't send the item, or where the buyer doesn't pay for the item.

There's a chance that the item gets lost in the postal system. I wonder if it is fair to ask the buyer to either carry that risk or pay for additional recorded delivery. That's probably fair.

The only other situation is the 'brick' problem . . where the seller might send a brick instead of the goods. Who do you believe if everything is in order . . . paid for, package sent, signed for . . . but buyer claims all he got in the package was a brick? In theory you could say the buyer should check the contents of the package before signing, but does anybody really do that?

[DeathAndTaxes]

The only other situation is the 'brick' problem . . where the seller might send a brick instead of the goods. Who do you believe if everything is in order . . . paid for, package sent, signed for . . . but buyer claims all he got in the package was a brick? In theory you could say the buyer should check the contents of the package before signing, but does anybody really do that?

Really the only solution to that is a man in the middle escrow.

Seller ships to escrow.  Escrow verifies and ships to Buyer.

If buyer says he got a brick well escrow knows that isn't true. 

The downside:
1) more work for escrow
2) double shipping costs
3) double shipping time

[deuxmill]

The only other situation is the 'brick' problem . . where the seller might send a brick instead of the goods. Who do you believe if everything is in order . . . paid for, package sent, signed for . . . but buyer claims all he got in the package was a brick? In theory you could say the buyer should check the contents of the package before signing, but does anybody really do that?

Really the only solution to that is a man in the middle escrow.

Seller ships to escrow.  Escrow verifies and ships to Buyer.

If buyer says he got a brick well escrow knows that isn't true. 

The downside:
1) more work for escrow
2) double shipping costs
3) double shipping time

Exactly. and what i said and what edd said .

If I had a auction site i think i would let people get burned and "test" buyers randomly myself . And if they fuck me up they get banned for ever . And all his personal details (address , names, nicks , whatever i can get my hand on) saved and published in a scampers database. Sure for the ordinary transactions i would implement a feedback system.
Sellers hate eBay exactly because of the escrow system.

[SaintFlow]

Imagine the following scenario on an eBay-like BTC site.

Seller lists item for sale on site.

Buyer purchases item and sends site BTC to hold in escrow.

A month passes, buyer complains the item didn't show up. Seller insists he sent it, but has no proof of dispatch.

What to do with funds in escrow?

What's a fair policy to handle this.

Weal .. no proof of dispatch? Then maybe no dispatch ? => Money back to buyer ?

Proof of dispatch ? => money to seller ?

No?

But the truth is the problem is far more complicated.

For example the  escrow can't know for example if the dispatched item is of the quality that it was portrayed in the listing. or even if the dispatched item is the item listed . The only real solution would be to dispatch it to thought the escrow which raises costs.

The answer is no escrow let people get burned and the genuine will raise to the top. 

+ reputation system

I ran into situations of distrust in the beginning of ebay,
ultimately everything went very nice and the lesson I learned
was to never risk more on a single transaction that you can stomach.

[finway]

seller prove, then buyer, then decided by the third party.

[FreeTrade]

Really the only solution to that is a man in the middle escrow.

Seller ships to escrow.  Escrow verifies and ships to Buyer.

If buyer says he got a brick well escrow knows that isn't true. 

The downside:
1) more work for escrow
2) double shipping costs
3) double shipping time

Thanks - hadn't been aware of this option. I'm thinking the shipping costs could probably be reduced if you have relatively fewer sellers - they could bundle up their items to send to the distribution center and only be sending one shipment per day, the distribution center could get good rates on the parcel distribution. Maybe in a place like Dubai for international trade, or somewhere central for specific countries. It's a bit grand for my ambitions, but I could see it being workable for a big operation. It might even get cost savings.

[DeathAndTaxes]

Thanks - hadn't been aware of this option. I'm thinking the shipping costs could probably be reduced if you have relatively fewer sellers - they could bundle up their items to send to the distribution center and only be sending one shipment per day, the distribution center could get good rates on the parcel distribution. Maybe in a place like Dubai for international trade, or somewhere central for specific countries. It's a bit grand for my ambitions, but I could see it being workable for a big operation. It might even get cost savings.

That would work.  Amazon does that (fiat only   ) for some 3rd party sales (called "fulfilled by Amazon").  You ship stuff to Amazon, then scan it put it into their warehouse and customer can order with confidence.  Amazon knows what they ship out and customer knows amazon knows so that cuts down on fraud.

If you want to think real big the shipping time could actually be reduced.  Seller ships to "escrow hub" ahead of sale.  He can use a slow/cheap method if he likes.  After sale/auction the escrow hub ships it out via faster method.  If hub has enough volume they can get rate reductions.  I know FedEx will discount 2nd day by up to 70% with enough volume (tens of thousands of units per day).  Even smaller volume (hundreds of units) can get solid discounts of 30%+.

[edd]

Thanks - hadn't been aware of this option. I'm thinking the shipping costs could probably be reduced if you have relatively fewer sellers - they could bundle up their items to send to the distribution center and only be sending one shipment per day, the distribution center could get good rates on the parcel distribution. Maybe in a place like Dubai for international trade, or somewhere central for specific countries. It's a bit grand for my ambitions, but I could see it being workable for a big operation. It might even get cost savings.

That would work.  Amazon does that (fiat only   ) for some 3rd party sales (called "fulfilled by Amazon").  You ship stuff to Amazon, then scan it put it into their warehouse and customer can order with confidence.  Amazon knows what they ship out and customer knows amazon knows so that cuts down on fraud.

If you want to think real big the shipping time could actually be reduced.  Seller ships to "escrow hub" ahead of sale.  He can use a slow/cheap method if he likes.  After sale/auction the escrow hub ships it out via faster method.  If hub has enough volume they can get rate reductions.  I know FedEx will discount 2nd day by up to 70% with enough volume (tens of thousands of units per day).  Even smaller volume (hundreds of units) can get solid discounts of 30%+.

This is actually something I put some thought into once I began selling and shipping items for bitcoins. Once the BTC economy reaches critical mass, I might tackle a bitcoin based shipping/distribution business. Adding an escrow service shouldn't be too much additional work.

[Elwar]

Give name and address of seller to the buyer. If not satisfied...seller's house gets burned to the ground.

Problem solved.