March 17, 2005 11:14 AM PST

Overstock denies shipping problems

Online retailer said Thursday that a Federal Trade Commission inquiry into its shipping policies was triggered by an increase in the number of orders it is fulfilling, not by widespread customer dissatisfaction.

The Salt Lake City-based e-commerce company detailed the FTC investigation in a filing with the U.S. Securities and Exchange Commission on Wednesday. Overstock said that it received notice of the inquiry in January and that it is cooperating with the FTC on the matter.

An FTC spokesman confirmed that its regulators are investigating Overstock but declined to comment further.

According to Jonathan Johnson, vice president of corporate affairs for Overstock, the FTC automatically launches such an investigation when it has received a certain number of consumer complaints regarding a particular service. He said the increase in reports to the FTC was likely driven by the fact that Overstock has steadily increased the number of shipments it is making, not by fulfillment problems at the company.

"We don't think that the percentage of complaints has gone up, but as the denominator got bigger, the numerator got to a point where it crossed a line, and the FTC sent us an inquiry," Johnson said. "We don't believe that we have a problem here; there may be some minor things that we need to tweak or fix, but we don't believe that this is a material issue."

Johnson said that a vast majority of Overstock's orders ship within two days, as the company promises. He said the company handles 40 percent of its order fulfillment in-house and it works with some 300 shipment partners to deliver the remaining 60 percent. Overstock charges $2.95 for basic ground shipping, but also offers customers expedited services at an extra cost.

"We're always looking at policies and trying to make everything clear for the customer," Johnson said. "As a result of the inquiry, we're reviewing our policies, but we believe that we're largely compliant."


Join the conversation!
Add your comment
It's about time Overstock was investigated
To make a long story short, the movie we ordered in mid-November was mispacked, and we spent literally 60 hours with the company -even after shipping back the mispacked movie- trying to get them to 1) not charge us for the return, 2) get the correct movie shipped to us, and 3) get it shipped a little faster than their 10-day timeframe.

We received the movie and some apologies - but barely a credit - in mid February. Even after escalating it to the office of the VP, which no one internally could or would do. And even then it took 3 ADDITIONAL WEEKS.


We will report this to the FTC now and hadn't thought of it before. Overstock obviously cannot keep their recordkeeping straight and does not care for customer satisfaction.
Posted by (1 comment )
Reply Link Flag's questionable policies
Two times over the period of one year I went onto
the's website and found a watch that I
wanted to purchase. In both instances, by the time I went to
purchase the watch it had gone up in price substantially.
The first time I began a heated e-mail volley with the
"customer service" representatives and even sent pictures
of the lower price (on the intro pages of the site) followed
by the +40% price a few clicks later. The rep's were of no
help whatsoever and kept replying with stock answers, that
had little to do with what I had written, and usually a day
It took me one whole year to get the bad taste out of my
mouth and go back to the site. And lo' and behold! The
same exact thing happened!
Although I was a repeat client before the first watch fiasco,
after what happened the second time I knew that I would
never, ever shop there again. I'm delighted to hear that
their practices are being investigated.
Posted by (1 comment )
Reply Link Flag
I'm sorry I didn't see this article before I ordered
I just went through a two week odeal dealing with Overstock's so called Customer Support. They didn't ship half of my order and finally admitted it after two weeks. When I wanted to return the one item, a suitcase, because without the other three matching pieces I didn't want it, I had to pay the shipping charges and a restocking fee.

And to think this site proudly displays the VerSign, BizRate, and BBB logos.
Posted by (1 comment )
Reply Link Flag
I ordered from Overstock on February 27th and was sent a tracking # that fedex said was only an electronic lable. It is now March 24th and still no package and Overstock is supposedly researching the issue. I want my refund yesterday!!
Posted by (1 comment )
Reply Link Flag
Ditto Ditto
I ordered three pieces and only got one full piece. I am waiting
for box b, I got a and c for one piece and the other piece is a
complete mystery because I have no instructions or hardware. I
was promised a 2 to 4 day turn around but of course, I haven't
heard a word. This has been going on for a month now and
truly, I will not order anything else even if it is less costly.
Posted by Archdavis (1 comment )
Link Flag
Overstock Uses Cust Service as an Excuse for Poor Performance
I placed an order for a mattress pad less than a month ago. I failed to order the correct option and didn't pick up my mistake until I printed the receipt for order. I caught the mistake a minute after placing the order and immediately called Overstocks (OS) customer service to see if they would change the order. They refused to change the order and refused to cancel. I escalated with each customer service rep that said they could not cancel the order. I must have escalated five or six times until I got one person on the line that said they could manually stop the picking/shipping process. Three days later I called back to make sure that happened. The person answering the phone assured me that after great effort the order was cancelled, even though it didnt say so on their website. Two days later the box arrived at my door.
I am now engaged with them trying to return the thing at their expense. They keep telling me that a shipping label is being sent to me. I call every other day and the person answering the phone says that nothing has been done and they will send the label. Nothing still. And now their website says my time to return the item has expired.
Thats it. A $130 mistake is the last I will make with them.
Dont go there!
Posted by (1 comment )
Reply Link Flag

Join the conversation

Add your comment

The posting of advertisements, profanity, or personal attacks is prohibited. Click here to review our Terms of Use.

What's Hot



RSS Feeds

Add headlines from CNET News to your homepage or feedreader.