Concealed Damaged is not as complicated as you think, but it is time consuming and you can potentially lose a lot of money.

As you know, I worked with a large online company and handled many of the shipping to Canada, Mexico, UK and of course throughout the US, including Puerto Rico, Alaska and Hawaii. When shipping abroad the last thing you want to deal with is CONCEALED damage.

Of course you do not want to deal with any kind of damage, but concealed damage can potentially become a nightmare.

I cannot emphasize enough that you must educate your Customer about receiving and inspecting the merchandise. Have your Policies clearly listed on your website, again on the Sale Agreement and for email them a copy upon Order Confirmation. Take the time to pick up the phone and advice them what to look for.

For example if you order a dining table from the States and have it shipped to you in Hawaii. You receive it without inspecting the packaging or without noting any possible damage to the contents. Later find damage this becomes a Concealed Claim. Upon the Customer (Consignee) signing the Bill of Lading you are legally releasing the company from any liability.

Most freight companies will settle a claim and offer to pay 1/3 ( some have lowered it to ¼) which can be a great loss for you and the customer.

Many times the package may have some wear and tear, but when corner appear crushed or punctured, you must take precaution and note it on the Bill of Lading. Failure to do so, will make it very difficult to prove the damage was sustained while in transit and not due to the Customers negligence to assemble it. Many customers have said: “Well there was nothing hanging from outside the box”. Right, this is why we ask that you note on the Bill of Lading what you see and the “Possibility of Damage”.

Therefore, when a Customer is setting up the dining table, they may encounter damage to the carvings, cracks on the leaf etc…. Customers’ first instinct is to call the Seller and demand a new table. Well, it is not always that easy. The seller is not likely to observe the cost of shipping you a dining table.

Whenever, I ship an item to a customer I make sure to inspect the item. I take images of the packaging and images of the item itself. This is critical for me in the event of a damage claim. The Freight Company will want evidence that you in fact shipped a brand new NOT Damaged Item.

(Emailing these images to your Customer will help assure them the item was shipped intact)

One of my favorite Freight Companies is Yellow Freight. They are far from being perfect. It all comes down to people. If you talk to the right people you can count on being taken care of. During these last few months, I am pleased to say that Yellow Freight has been diligent (at least with my account and others I know that use them) to take care of any issues and in settling any open claims in less than 30 days.

Just recently, Yellow and Roadway Freight have merged their systems. I am hoping that it is for the better. Only time will tell.

At no time to you want to have any Concealed Damage claims. As they are hard to prove and the customer may claim a Charge Back with their credit card “For Goods Not As Described”.

Charge Back on Concealed Claims

When a Customer files a Chargeback with their credit card company it is customary for the Credit Card Company to place a hold on the funds (they usually allow me 30 days to respond and provide proof. Funds are not taken out until the Credit Card Company determines the liability).

Upon contact from the credit card company:

Provide them with links to your Policies and Terms & Conditions

Provide them with the Sale Agreement (most shopping carts have this tool)

Provide them with a statement of events

Provide them with emails

Most importantly provide them with the Bill of Lading

Note: The reason you have a concealed claim is due to the Customer failing to note any damage on the Bill of Lading. Therefore, this is the most important piece of evidence.

I have not had a single credit card company rule against me. This of course is frustrating that your Customer took it so far. Ultimately, it is in your hands to decide how you want to handle your claims.

Settle Directly with your Customer on Concealed Damage

Your customer filing a chargeback with your credit card company is the last thing you want to occur. Depending on your Merchant Contract and history with your Bank too many Charge-backs (whether your fault or not) can affect your RATEs or worst limitations can be placed.

(If this occurs with you with Paypal – You will lose all your money. Paypal does NOT offer you any protection and they do not Honor your Terms & Conditions)

Settling directly with your Customer will prevent any charge backs and will allow you the opportunity to make an unhappy customer a Happy One. This is really what you want to achieve.

You will have to decide whether you can ship a replacement part or offer a cash discount for the unfortunate damages the carrier caused. Should your customer be unwillingly to accept any of your offers then you can always offer to assist them with the filling of their claim with the carrier.

Directing your customer to file the Concealed Damage claim with the Freight Company will allow you to focus on your daily business. If you are a company and have staff to handle the claims then a better option would be for you to take control and file the claim. The goal is to have the Customer involved in the process and settle the claim with the Freight Company in less than 30 days. Most customers are appreciative of being informed and when they know that you are doing all you can to right them for the wrong done, they will wait.

Contact your Account Representative and ask for links and print out of their Damage Policy. Some carriers will not insure your shipment unless it is clearly stated on your Contract.

Damage Claims are not fun but you can get through them when you understand how to file and work with your customers.

Now that I am working from home I have stopped offering items that would to be shipped with a Freight Carrier. I am not in a position to finance my damages. Therefore, for now, I am only selling what can be shipped by a ground. Sure, claims can occur, but the items I offer now are smaller and less likely to suffer damage while in transit.

Do you have a favorite carrier? Any advice you want to share it greatly appreciated.

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