Important Change to uShip’s Cancellation Policy [Updated]

Heather Hoover[UPDATE:  This policy change went into effect January 20, 2011.]

Starting in the coming weeks, we’re making an important change to our cancellation policy in an effort to hold customers more accountable when they are responsible for a cancellation.  In the event of a cancellation, any booking deposits and service charges paid by the customer through uShip will be refunded in the form of an account credit.  The customer can then use this credit if they relist and rebook the same or any other shipment within 12 months.

Heather Hoover, Community, Trust & Safety Manager at uShip, further explains the changes, how the policies differ and why uShip is adjusting its cancellation policy:

What is different about the new policy?
Today, when a shipment is cancelled, deposits and service charges are directly refunded back to a customer’s credit card (or whatever payment method was used).  When this new policy takes affect, when a booked shipment is cancelled, the customer will receive a credit to their uShip account equal to the Booking Deposit and Service Charge they paid at the time of booking. This credit may be applied to the Booking Deposit and uShip Service charge for the same or any future shipments booked within one year of the cancellation date.

Why are we making this change?
Over the last year or so, we’ve noticed that the cancellation rate on uShip has crept up to unhealthy levels. We’ve put excessive cancellation penalties in place for Service Providers to help to moderate cancellations that are the fault of the Service Provider – which has worked well.  However, we’re now hearing from our Service Providers that customers are still cancelling on them too much because “they have no skin in the game.”

The upcoming policy change is intended not to impact customers when their Service Provider is responsible for the cancellation because most customers relist and rebook on uShip anyway – so the account credit is effectively the same as the direct refund. However, when a customer cancels and does not relist and rebook within one year, they forfeit their deposit and service fee. We anticipate this will reduce the number of cancellations requested by customers and allow Service Providers to be more confident that the loads they book on uShip will be honored by their customers.

Will the Cancellation Review process change?
No. When one party requests a cancellation, the other party will still have 72 hours to respond before it is automatically processed. In the event of a dispute, the cancellation will be reviewed by the uShip Support Team to determine an appropriate resolution.

How will this affect SafePay payments?
Payments made through SafePay will continue to be refunded in full directly to the customer’s chosen payment method, as long as the SafePay payment code has not been released and services have not been rendered.

When will this policy take effect?
This policy goes into effect by the end of January, at which point all cancellations processed will be subject to the new policy.

Will this policy change impact all customers?
We are initially implementing this change for registered users in the U.S. and Canada. For the time being, the current policy will remain in effect for users in all other countries.

I have questions/concerns. Where can I get more information?
We hope that everyone in our community understands the need for this change, but if anyone feels like our policy is unfair for their specific situation, please let us know by contacting contact Member Support and we will always do our best to do the right thing!

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UPDATEThis policy change went into effect January 20, 2011.

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  • http://profile.typepad.com/chrlsful c.

    Ms. Hoover:
    Thanks for the opportunity to comment.
    I like the policy but not the reason. No customer in a transaction should have “any skin in the game”. We have a different type of national policy than that – buyers can always drop out of a transaction without penalty in this country. There are reasons for that. I have 2 parts for my objection:
    1). the above. I don’t have the spelling skills to quote “the buyer beware” in Latin but the market place is already balanced toward the seller and many of out laws have been put in place to counter these ‘natural’ occurrences;
    2). and possibly more important -
    This is an internet transaction, a) less clarity is available in the relationship due a technology being placed between the direct interaction of the individual and the seller (& it is much more opaque than use of a telephone or across a store counter), b) the technology is in itself (just negotiating it, “how does uShip handle this aspect, how does this work, where is this found, why aren’t things explained or more clear, what happens if I do this”?) can be a difficulty, c) some people may be trying to understand these factors by the only way they can – working with it – getting into it, and in the seller’s need to sell (that’s what they do) a transaction may B approved before the buyer is totally prepared.
    One thing i have made sure of in the two business relations I’ve contracted here @ uShip is that both parties TOTALLY understand all the conditions before I select the ‘accept bid’ button. I have always fed-back the understanding to the seller. Often a deal would not go through because this was too cumbersome a process (I assume, or, may be it was because specific points we’d discussed were come ons & the seller could not meet them seeing them in writing). It has taken a very long time to conduct business this way. There are many parties (over 6 in some cases: broker, aid or second-to-the-broker, uShip, seller, trucker, owner, warehouse, buyer) in a deal (esp. w/brokers) and “all the stars” have to align. Otherwise one individual in the supply chain may get a surprise which can nix the deal for all. I liked the non-broker deal better but still had to facilitate a “no surprises” transaction for the trucker, owner, and myself – the buyer. I’d say as facilitator, producer or whatever term we use, I had alot of skin in the game just by riding heard on the whole process.
    Again, thank you for the opportunity, providing this ‘connection service, AND assistance facilitating transactions as a third party when needed for completing one of my deals in the past.

  • http://profile.typepad.com/juggernauzt Juggernauzt

    Keeping the deposit is unfair and a questionable practice because Uship “ONLY” earns the $10 processing fee plus a percentage of the sale aka uShip transaction fees. So Uship only earns a respectful fee for the transaction.
    However, if Uship keeps the deposit and the buyer doesn’t complete another transaction or shipment in the “one year period” then Uship keeps all the money and that is not just unfair but its a practice that keeps more than the contracted amount set forth in the contracted terms. I’m sure lawyers will agree, in fact I think Uship needs to rethink this and come up with a reasonable fee that covers the costs of canceling the transaction and refunding the fees to the buyer. Bear in mind Uship still earns the upfront fees and costs to cover running the computer system etc…. that are already factored into the transaction at the point the customer makes a deposit.
    Now if Uship wants to keep the $10 fee plus another $5 to $10 to cover refunding the money after canceling the transaction then so be it. But to keep the whole deposit, no that is not fair and is easily debatable once a customer finds they will not have a need for a second shipment in a one year period. Better to refund the money because people will feel jilted and many will think “I”ll take my business elsewhere” and there are other services so its better to create a respectful cancellation fee and maintain a good relationship with all customers. Respect grows a business, I know the economy is down, that’s the risk of business in general but you don’t won’t to hamper the company customer relationship because we all know many do not read the terms of service and will expect a refund. Please change the rules.
    Thank you.

  • http://profile.typepad.com/icepack138 Ken Campbell

    Once again, Uship has come up with a way to make money for theirself. I don’t see where you’re giving any of the money to the transporter who is out everything because of a whimsical cancelation. The fair thing to do would be to pay the deposit amount to the transporter who may have passed up other jobs to complete the now canceled one. just like your affiliate program where you don’t give proper or accurate credit or pay everything due to the party making referals, here once again it’s only what is good for USHIP!

  • http://profile.typepad.com/contact317 Tom

    EQUITY to all involved should be the keyword to this policy. This Ménage à trois between U-Ship, Shipper, and Service Provider should not leave just one party satisfied. Each party involved has a vested interest and has expended effort and assets. If this deposit is to be refunded it should be divided equally among each party involved, even if it is just an account credit. I understand the need to try and generate quality shipment listings and I applaud the effort. However, my humble opinion is that this policy in its present form is one sided and negates the effort. It will do nothing but alienate transportation providers and shippers eventually driving them from the site or at the very least prevent repeat business. To the folks at U-Ship…. to increase your bottom line, invest in your assets.

  • http://profile.typepad.com/craigscargocab Craig

    I whole heartedly agree with Tom. This is a Lose-Lose-Win situation and the shipper and service providers are the losers, while U-ship adds to their bank account. While I appreciate Uship and the business it provides, I have lost a lot of money due to last minute cancellations by shippers. The shipper is penalized by forfeiture of their deposit and the service provider is penalized by loss of income (having to re-route or frantically search for other shipments on Uship or elsewhere). A three-way split of the deposit paid seems more equitable.