Reporting assets of $427,364 and liabilities of more than $5.2 million, Assurz Inc. has filed for bankruptcy protection in the U.S. Bankruptcy Court for the Northern District of California.
Reporting assets of $427,364 and liabilities of more than $5.2 million, Assurz Inc. has filed for bankruptcy protection in the U.S. Bankruptcy Court for the Northern District of California. The company had provided a no-questions-asked return and refund service through online retailers.
The first meeting of creditors is scheduled for July 30 in the San Francisco office of the trustee for the case, Janina Elder; the last day for filing claims against Assurz, which operated out of Redwood City, CA, is Oct. 28, 2008. The case has been assigned to Judge Dennis Montali.
Assurz noted in its June 23 bankruptcy filing that it had gross income this year of $350,516 through April, compared to $23,659 for all of 2007. It also reported cash on hand of $7,828, not including more than $30,000 in two security deposits.
Of its total liabilities of $5,249,641.60, $4.46 million was in unsecured claims from hundreds of creditors.
The Assurz service was popular with consumers who could buy something online-particularly costly to ship items like bath tubs or other home improvement products-without having to worry about paying for return shipping or restocking fees, says Michael Fox, co-founder and chief operating officer of eImprovement.com LLC, one of Assurz’s former participating retailers.
Fox says about 500 of eImprovement’s customers opted for the Assurz service each month, about 3% of total orders, and that it appeared to result in higher conversion rates and sales on eImprovement.com and its sister sites, which include eFaucets.com and HomeFixtures.com. But it also increased overall return rates from about 5% to 9% after eImprovement started offering the Assurz service in January, because 6% of the customers who opted for the service returned products, he adds.
The sudden termination of the Assurz service in late May left many consumers without a way to get refunds for products they had returned through Assurz, Fox and other retailers say. Assurz charged fees for its service directly to consumers, then would liquidate the returned merchandise to cover its costs and earn revenue.