I hope to provide guidance on effectively checking and understanding Feedback to help buyers avoid troublesome sellers.
The Feedback System was put in place to allow buyers to give a brief description of their transaction with a seller and vice-versa. If a buyer had a great transaction then a positive feedback is usually left. If the transaction wasn't so hot but not terrible enough to warrant damage to a seller's "reputation" then a neutral feedback is usually left. A neutral feedback does not boost a seller's score, nor does it detract. (EDIT: apparently Neutral feedbacks now also detract from a seller's score) If a buyer had a terrible experience, such as no item being delivered or a seller sending damaged goods then a negative feedback is usually left. This type of feedback detracts from the seller's "reputation" and in many cases (such as the seller I will use as an example) leaving a justified negative feedback such as no item delivered, extremely poor communication, or theft of payment will result in a "retaliatory negative" left for the buyer, or a negative feedback that is unjustified (buyer paid promptly, made every effort to contact seller and rectify the situation) and left simply as a "tit-for-tat" or "eye-for-an-eye". Buyer left seller a negative so the seller leaves buyer a negative. A very immature and childish practice that proves extremely hurtful to low score members but hardly hurts high score "power sellers" and stores. One should also be aware that many sellers see a neutral feedback as a negative and will also leave retaliatory negative feedback as a result despite their "reputation" not being directly affected.
I spent quite a bit of time scrutinizing hifisoundconnection, as they carried an item I was interested in. At the time of my examination, they had a 99% positive score with a purple star and Powerseller label. Pretty good, huh? But then I saw their feedback score of 62,172. That means approximately 1% of their buyers felt compelled to leave a negative score. Upon clicking the feedback profile, this amounted to 659 negative transactions and one must keep in mind that even though a buyer may leave multiple negatives for multiple transactions, only one negative actually counts against the seller's score! So in reality there are far more singular negatives! Further examination revealed 293 neutral transactions in the last 12 months!
During my "background check" I also found a multitude of "mutually withdrawn" feedbacks - negative feedbacks that were mutually withdrawn through arbritration. What does this mean? In some cases it means the situation was resolved after negative feedback was left and both parties agreed that negative feedback was no longer required. But in the case of this seller, most mutually withdrawn feedbacks are the result of retaliatiory feedback against a low score buyer. The buyer had a very bad experience and left a negative. The seller responded with an unfounded retaliatory negative (in the case of hifisoundconnection they have an AUTOMATED feedback system which leaves a pre-generated, generic, and AUTOMATIC NEGATIVE in response to negative feedback received). In an effort to save their low score, the buyer agrees to withdraw their negative if the seller does so. As a result the buyer's score is saved as well as the seller's, even if the seller really deserved a negative. And since the feedback was withdrawn, it doesn't strike against the seller's visible score and can only be seen if one reads through all the past feedback (EDIT: The total number of Mutually Withdrawn feedbacks is displayed in the upper right corner of the feedback details window). A very vicious and underhanded way for these large volume sellers to hide their unsavory business practices.
It is very important to check for patterns in a seller's negative, neutral, and withdrawn feedback. Looking at hifisoundconnection, I found extremely slow shipping, advertising same day or next day shipping and not shipping for days or weeks, offering free shipping and charging anyway, offering free insurance and charging, no communication, goods not as described/not suitable for advertised application, and pledging customer support by phone or e-mail and buyers unable to reach any type of customer service rep. In many of the pregenerated negative and neutral responses I found promises of "call us for help" and "offered refund or upgrade" when in fact nothing was ever offered because the buyer couldn't reach an actual person for assistance. Another disturbing practice is selling items they do not have in stock then forcing the buyer to either wait until the item is in stock or take "in store credit" instead of offering a full refund as they sometimes state (quite possibly against eBay's TOS and Policies). With sellers such as this, payment via Paypal is your safest route because Paypal can get your money back in the event that the seller cannot deliver the goods but refuses to refund your payment. A few buyers had to take this route and were left negative feedback as a result! Certainly a very poor business practice.
It is very important to examine feedback closely, no matter what the positive percentage score may be - remember, you could be one of the 1% that had a terrible transaction and it is important to understand how you could be treated in the event of trouble. In the case of this seller, I decided it would be best to do without the item they carried and avoid any chance of conflict. A seller that uses pregenerated and automatic comment responses, leaves automatic and pregenerated retaliatory negative feedback, and gives contact instructions but fails to assist customers in any way is not the kind of seller I want to do business with. In fact, it is sellers such as this that have done such a great job of tarnishing eBay's reputation. No longer is eBay a place of auctions and friendly sellers - it is dominated by big dropship sellers peddling trash and hiding behind huge sales numbers to bully new and low volume buyers. The colored stars and "powerseller" labels mean nothing, the proof is in the pudding and the pudding is the feedback. Always read it carefully, especially when you are spending a large sum of money, and be sure to weigh the possibility of conflict over the "savings" you may not actually be getting. The feedback war headache you could be getting yourself into is NOT worth $10 in savings.
EDIT: Hopefully eBay's new feedback policy preventing a seller from leaving neutral or negative feedback will eliminate the childish "tit-for-tat" mentality that some sellers seem to have! Good luck and happy bidding.

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