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Returns / Chargebacks / Refunds

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  • Returns / Chargebacks / Refunds

    Hi guys,

    What kind of return rate are you seeing with your physical products? What kind of guarantee do you give your buyers?

  • #2
    What kind of return rate are you seeing with your physical products? What kind of guarantee do you give your buyers?
    Really depends on merchandise category and buyer. Women return more than men, but part of that might be because the products they bought were purchased with the intent to return if they don't really like the look or feel. Two high return categories for us have been any clothing (with sizes) or accessories (like belts) and jewelry. We also have found that brand name products have a lower return rate, which I assume is because people are show-rooming retail stores when they buy or have experience with the item or just trust the name. Good pictures and descriptions help. I try to stay away from anything with sizes at this point. Excluding clothing and jewelry, across the board I would say return percentages have been low single digits.

    30 day - 100% money back guarantee has been standard. We've tested shorter and longer return periods but didn't make a difference for us. Our standard terms are that the customer pays for return shipping, unless they complain, then we will cover it. We do make them contact us for a return authorization so that we can track the return and match refunds.
    Ideas are everywhere, it's execution that's in short supply.


    • #3
      30 day 100% no questions asked returns. sometimes we let them keep it anyways as shipping it back is to much $ for the worth, this helps build a relationship as well - we range from .8% to 1.4% $ returns.


      • #4
        anyone experienced fraudulent purchases as well that will get charged back due to fraud? with a high enough % of these I'm assuming your merchant account will get suspended.


        • #5
          Yes, but they have been a very low number. I remember some of them because they were a headache, but overall not very costly.
          Ideas are everywhere, it's execution that's in short supply.


          • #6
            30 day. 100% money back.

            Definitely fraud can cause havoc with merchant accounts. I have a close friend that had a competitor trying to take him out and sent a bunch of fraud transactions thru his mids. As with most things in life. If possible have a backup.

            If you have subscription revenue I'd make sure you're storing the card numbers in a PCI compliant system. This way if for some reason your processing company kills you. You can move the portfolio to a new processor and not lose that revenue.

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            • #7

              Do you have a list of processors you like?


              • #8
                Using stolen cards to kill competition's MID's.. sneaky.. sneaky.. I've heard of such stories as well. My 2 cents - have some system to detect high risk transactions, get the merchant to ask for vbv/3d verification - makes fraudsters life a lot more difficult as the data they need to defraud you now costs a lot more.. also I think visa/mc take more liability. Then you can always call up the clients to verify the order before letting it through.. you have to find the balance between fraud detection and creating unnecessary friction for the 99% legitimate buyers that can eat up your sales...cause if you go over the board when trying to mitigate fraud you risk losing actual clients.. think of paypal for example - these guys have been defrauded a lot and thanks to this now legitimate users are having a hard time..we all have heard of horror stories where people get 6 figure sums frozen for months on end..

                also, killer tip on storing the card numbers in a PCI compliant system when doing recurring business.. backups, backups, backups...

                as another note.. what I tend to do is write down all the risks I have in my current setup and actively try to find solutions/plan b's/patch them.. be on an active lookout for getting cheated on/defrauded.. ask yourself - what could go wrong? healthy paranoia
                Last edited by dmitri; 04-17-2016, 01:53 PM.