Are returns killing your business? Think not?
- 6.4% of holiday returns were expected to be fraudulent last
- 93% of survey respondents said stolen merchandise had been
returned to their stores in the past year
- 75% said that merchandise had been purchased with fraudulent
or stolen tender
- 43% said they experienced returns using fraudulent receipts
46% said that wardrobing – the practice of return used,
non-defective merchandise like
apparel and electronics had been an issue for their company
If this is what’s happening for the big guys, guess where
your store lands? The situation is probably worse. For independent retailers, it’s all about customer service,
and ensuring that the customer has the best experience possible. And that means
bending over backward to accommodate them, and more than likely enabling fraud
to take place at your store. But don’t be fooled. We all know fraud happens everywhere.
And more times than not, that merchandise ends up in the damages pile or is
marked down significantly, eroding profits.
THE REAL WORLD RETAILING TAKEAWAY
Crack down on fraud while maintaining your customer
experience. Here are a few ways to crack down on fraud.
- Set time frames that merchandise can be returned. Major
retailers leave it open-ended or have fairly long return timelines (60 or 90
days). It’s perfectly acceptable for your store to have a 30 day return policy.
Just make sure it’s posted clearly at your cash register.
- Keep track of returns.
There’s a reason so many stores ask for a driver’s license when a return
is made. It’s because they’re creating a database of returns that are
tied to each customer. Become a serial “returner” and you get
not being allowed to return items to that store. They employ big
use their software to accomplish this.
For you, it’s as easy as creating a spreadsheet and sorting it by
then keeping it handy. Every time a return is made, simply log it in.
enough, you’ll see if there are serial “returners” who are commiting
- Require that tags are still on the item and that packaging
is intact. Enough said. If the tags are still on, and the packaging is intact,
chances are better that it wasn’t used. ’nuff said.
- Place tags in visible places. The practice of wardrobing
results in items being used, then return after the use. It’s really like
renting an item. By placing the price tag and manufacturer’s tags in visible
places, it makes it harder for a customer to purchase the item, then hide the
tags when they try to wear it.
- Offer employee incentives to catch fraud. Offering up a
reward to employees who find serial returners is a small price to pay. Think
about a $10 or $20 reward and the parameters under which the employee can earn
Of course, you need to make sure your return policy is
clearly spelled out on signage right at the cash wrap. Some retailers even go
so far as to have it printed on a pad and stapled to the receipt. Other
retailers are sophisticated enough to have it printed right on the receipt. No
matter how you go about it, make sure you verbally tell loyal customers your
return policy has changed so they’re not caught unaware.
How are you fighting fraud in your store?
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