While it may seem like return fraud is a bigger problem for larger and more traditional brick-and-mortar stores, online retailers are feeling the same ill effects from it. For example, the NRF estimates that there has been a 5.5 percent increase in fraudulent PayPal transactions that only shows how much of a problem this is quickly becoming for Internet retailers.
If you’re a business, you’re likely to want to find ways to protect yourself from this type of fraud. This article will learn about 5 of the best ways to prevent yourself from becoming a victim.
- Modify Your Policy
One of the key things you should modify is your return policy. While it’s one of the best times to run an online store, it can quickly turn into a terrible time if you don’t have the right policies in place. In addition, with significant increases in return volume, you want to be certain you have a method of validating returns.
Because of this, you should try avoiding return fraud by modifying your return policy with a strict cut-off date in mind. This can ensure that all of your honest customers act fast, and it keeps them from using products before they return them.
Likewise, you may even want to place specific restrictions on the return policy for various popular items to ensure they aren’t returned too late in the season.
Receipts are a key part of keeping fraud at bay. Receipts are a good way to ensure that you are accepting valid returns. Without receipts, you have limited resources indicating you accept a return from a sale you made. This is proof of purchase that can help reduce fraud within your business. Thus, it is always a good idea to require them.
While confirming a transaction manually takes a lot of work, it’s necessary. However, there is a better way to go about it. You can use ReturnLogic, which offers a return portal that automatically verifies the purchase before the return is created.
- Tag It
Everyone has heard about the different stories from customers who purchased an expensive item and worn it only to return it later. This form of return fraud is growing in popularity, and it’s typically referred to as “renting.” Unfortunately, these products typically come back ruined and cannot be resold. Thus, it can negatively impact your business’s bottom line.
- Add Cushioning
When you are looking to minimize return fraud, you need to add some incentive to avoid returns in the first place. For example, how do you stop someone from buying a TV to watch the Super Bowl only to return it later?
You can do things like add a restocking fee on high-value products. You can also do the same for difficult and expensive products to ship. However, ensure you are selective about the products with a fee because you don’t want to provide negative incentives for some of your best profit margin products.
- Avoid Giving Out Return Labels In Your Shipped Box
When you are looking to minimize returns in the first place, you want to make it less convenient. However, putting return labels in all of your packages is one of the easiest ways to expose your business to more return fraud. Try to consider other alternatives that can be better for your business and your customers.