Balance, how do you achieve it as a retailer especially when it comes to return fraud? You have to keep your customers happy and coming back to shop but you also have to make sure you aren’t taking a financial drubbing in the process. Recently I purchased some clothing for my wife as a gift and as I am prone to doing I made several errors. First, I forgot that clothing sizes do not always agree from one brand to another. Apparently you have to unfold and look at the items individually. Who knew? Oh, stretchy rayon fabric, another no-no as the sizes are very deceptive. Scoop neck, V-neck, T-neck, three-quarter length sleeves, material is too thin you can see through it, cowl neck, the list of what I can and can’t buy is too long to remember. Perhaps a gift card is in fact my safest choice. On the other hand I did avoid my usual error in clothing purchases. “Honey, you got me two blue shirts and you gave me the same thing last year.” Nope, no duplicate clothing this time, just the wrong fabric and sizes. I do confess, I try but to be fair my wife has pointed out to me what to look for and I just simply forget. Which brings me to my point, I forget and she has to take the items back and exchange them or get a gift card. I DO remember to keep my receipts and all of the tags I have learned that in my retail work over the past 25+ years. We return the items and my wife finds what she really wants. Honest returns with receipts and tags. Guess what? There are those who commit return fraud and also have all of their receipts and tags and they engage in what is called wardrobing.
Wardrobing may sound innocuous and non-criminal unlike return fraud but the hard reality is it can be worse than regular fraud. Often fraud involves no-receipt returns, merchandise that does not match what is on a receipt, the wrong tags on an item someone is trying to slip past the customer service employee or multiple exchanges in an attempt to get cash back. When someone is wardrobing they are buying clothing with the intent of returning them after using the garments one or twice. It is sort of like renting an item without ever paying anything because the clothes are worn and then returned with the tags attached and the patron has the receipt. This person appears to be following store return policies so in their mind they are not doing anything wrong. The problem is that the “customer” never intended to make the purchase permanent. Store personnel may have wasted a significant amount of time assisting this person. If someone works on commission they lose that commission with the return of the merchandise. Sometimes the items have to be cleaned upon return due to odors or stains. Even when cleaned sometimes garments have to be marked down or possibly tossed out and the item marked out of stock. Both situations cost the store money. Is there a way to balance returns from honest customers like me and those who would intentionally abuse store return policies? What if I were to lose a receipt would you want to refuse MY return? Wardrobing tags on your products can resolve the issue.
Bill Bregar is the Chief Executive Officer of Loss Prevention Systems Inc. and he gets it. He knows you can’t ostracize one loyal group due to the return fraud committed through the act of wardrobing by a small percentage of people. In order to maintain a balance that will keep your customers happy and send fraudulent customers elsewhere, Bill and the folks at LPSI suggest using wardrobing tags on all of your clothes. These are one-time use only, bright red tags that are pinned to clothing where they would be visible if someone wore the item out somewhere. The tags are removed by the customer after the purchase and it is determined they want to keep the item. They still allow clothing to be tried on but no one would wear the item in public with the tag on it. If the item needs to be returned, the tag has to be attached and all receipts and labels brought with it.
Return Fraud is fraud and nothing else. It isn’t harmless and it could be costing your store a bundle of money each year. Your good customers deserve your respect and trust. Balance the good against the bad with wardrobing tags and stop losing money to fraud.
Return Fraud is important and we can help you with it. Call 1.770.426.0547 and let’s talk.