Is Return Fraud Just Cost Of Doing Business?
When your company realizes that profits are down, they generally add two things to their plan: raise prices and lower expenses. What if the profits are being lost to refunds and return fraud? If those returns include giving back full price for used and now damaged merchandise, then the answer could be simple. Your company may need to lower some expenses, but let me tell you why investing in Alpha Shark Tags should be considered.
There are a growing number of dishonest people that are engaging in the practice of wardrobing and they are killing the profit line for clothing retailers. That means they buy an item they cannot actually afford, wear it to whatever event they had planned, and then return the item for a full refund. Many times these garments are rendered unsellable when they are returned. Since there is such great competition in the clothing store business, lenient return policies are rampant. Companies believe it is simply the cost of doing business in order to keep their honest clientele loyal. Managers do not want to have that extremely awkward conversation with someone trying to return a dress that has obvious sweat stains around the armpits. If someone brings back scuffed up leather shoes, or an expensive handbag that has lipstick stains inside it, many stores will just look the other way and give that person back their entire purchase price! The customer says it has a defect, or is uncomfortable, and the manager doesn’t want them to make a scene.
The truth is there needs to be a balance between loss prevention and excellent customer service. When someone buys something with the intention of bringing it back, it should be considered a form of shoplifting. Your company could try to add a restocking fee, but that practice is widely criticized. Another great solution to the problem of wardrobing is to attach Alpha Shark Tags to clothing that is primarily targeted by these problem shoppers. These bright red clips are designed to attach right to the garment, in a highly visible area, such as the front hemline or front pocket. They are meant to be removed by the customer at home. They do not interfere with the customer’s freedom to try on the item, so they can be attached at the time or purchase or can be put on before displaying on the sales floor. They can also be used to secure a copy of the store’s return policy to the actual item. The idea is that once a customer uses a pair of household scissors to cut off the Alpha Shark Tag, that item is no longer eligible to be returned for a full refund.
Many store managers and owners will continue to balk at adding this policy, calling it retailer mistrust. They say that there are simple cases of buyer’s remorse. To that I say the customer should have changed their mind before they spilled red wine on the party dress, before they got makeup all over the neckline of the fancy blouse, and long before they got crumbs and grease spots in the pricey handbag. When they bring back used merchandise, the retailer loses the garment or accessory plus the profit. That is no way to do business and stay afloat. The cost of doing business will include the occasional return of a truly defective item, but is should not include dealing with wardrobing. Business can take a bite out of return fraud with Alpha Shark Tags.
For more information on Alpha Shark Tags, contact us or call 1.770.426.0547