Return Fraud: The Retailer’s Arch Nemesis

 

Wardrobing-2, Return Fraud-3 , Alpha Shark Tags-3
Return Fraud: The Retailer’s Arch Nemesis
Unless you are in the party supply or tool business, you are probably not dealing in merchandise rentals.   And even in those types of businesses, rent is not free.  Some customers, however, have found some creative ways around the usual way of buying and selling.  These are the people that are engaging in return fraud, and there are several ways they are getting away with it.  Surveys and studies show that eight to ten percent of all refunds that retailers perform are some form of fraudulence.  It is a significant issue that can very negatively affect the financial performance of a company over time and drive it straight into bankruptcy.
Of course, customers tend to be the number one suspects for return fraud.  We’ve all probably dealt with that person that sneaks in to steal a high dollar item, and then tries to act as if they are making a return.  Sometimes they conceal the item, go out the door, and then come back in.  Sometimes they have a partner waiting outside who will attempt the return.  Other times they are bold and simply walk from the aisle straight to the register.  Because of this, many retailers have added restrictions to the return policies and will not process them without receipts.  There are also the customers that engage in “free renting”, also referred to as wardrobing.  This is a particularly nasty little practice because the customer buys items from your store with the intention of returning it.  They keep their receipts with all the packaging,  and bring the stuff back expecting a full refund.  What makes this such a bad practice is that many times this merchandise is no longer sellable.  This is not just a problem for the clothing business, as it was named for.  Electronics, wedding supply, and even furniture dealers can be victims of this deception as well.  A guy comes to buy the biggest television you have on your sales floor for the next couple of weekends for the playoffs and the championship game.  A woman comes to buy some big center pieces and table linens for her big party or event she is planning.   Then when the games are over, the party people have all gone home, these folks come back to return everything they bought to the respective stores.  The television has dust and roaches inside it.  The table wear has wine and grease stains.  
There is a way to combat wardrobing, which is absolutely return fraud.   When it comes to losing profits, something has to be done.  That’s where the Alpha Shark Tags come into play.  These are just great little gadgets that can be part of any successful return policy.  You simply attach them to any item, whether directly or added to the packaging.  You clip it right on and then if the customer removes the Alpha Shark Tag, the item is no longer eligible for a return.  They are meant to be removed at home with a simple pair of household scissors.  They cannot be reattached, so those customers that bought the ticket gun to put the price tags back on is also put out of business.  Alpha Shark Tags are tamper evident and they can’t be beat.  They are the kryptonite to the “free rent” criminals of the world.  
For more information on Return Fraud, contact us or call: 1.770.426.0547

Unless you are in the party supply or tool business, you are probably not dealing in merchandise rentals. And even in those types of businesses, rent is not free. Some customers, however, have found some creative ways around the usual way of buying and selling. These are the people that are engaging in return fraud, and there are several ways they are getting away with it. Surveys and studies show that eight to ten percent of all refunds that retailers perform are some form of fraudulence. It is a significant issue that can very negatively affect the financial performance of a company over time and drive it straight into bankruptcy.

Of course, customers tend to be the number one suspects for return fraud. We’ve all probably dealt with that person that sneaks in to steal a high dollar item, and then tries to act as if they are making a return. Sometimes they conceal the item, go out the door, and then come back in. Sometimes they have a partner waiting outside who will attempt the return. Other times they are bold and simply walk from the aisle straight to the register. Because of this, many retailers have added restrictions to the return policies and will not process them without receipts. There are also the customers that engage in “free renting”, also referred to as wardrobing. This is a particularly nasty little practice because the customer buys items from your store with the intention of returning it. They keep their receipts with all the packaging,  and bring the stuff back expecting a full refund. What makes this such a bad practice is that many times this merchandise is no longer sellable. This is not just a problem for the clothing business, as it was named for. Electronics, wedding supply, and even furniture dealers can be victims of this deception as well. A guy comes to buy the biggest television you have on your sales floor for the next couple of weekends for the playoffs and the championship game. A woman comes to buy some big center pieces and table linens for her big party or event she is planning. Then when the games are over, the party people have all gone home, these folks come back to return everything they bought to the respective stores. The television has dust and roaches inside it. The table wear has wine and grease stains.  

There is a way to combat wardrobing, which is absolutely return fraud.   When it comes to losing profits, something has to be done. That’s where the Alpha Shark Tags come into play. These are just great little gadgets that can be part of any successful return policy. You simply attach them to any item, whether directly or added to the packaging. You clip it right on and then if the customer removes the Alpha Shark Tag, the item is no longer eligible for a return. They are meant to be removed at home with a simple pair of household scissors. They cannot be reattached, so those customers that bought the ticket gun to put the price tags back on is also put out of business. Alpha Shark Tags are tamper evident and they can’t be beat. They are the kryptonite to the “free rent” criminals of the world.  

For more information on Return Fraud, contact us or call: 1.770.426.0547