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Return Fraud

In: Business and Management

Submitted By karieschwartz73
Words 672
Pages 3
Return Fraud in a Customer Service Based Culture
Keeping the Profit

Submitted By Karie K. Schwartz
Capella University
4 April, 2015

Return Fraud in a Customer Service Based Culture
How does a retail corporation protect themselves from losing millions in organized return fraud but still encourage faith and trust in their return customers? Return fraud is a costly problem for Retailers. When met with necessary preventative and latent measures to recoup the financial losses, the company can procure lost income. Unfortunately, these measures are potentially discouraging to loyal customers and future sales.

TYPES OF RETURN FRAUD
Return Fraud is returning items for cash or credit in a store with the intent to steal money from a company. Stolen goods sold by boosters to fencers (Turner, 2010), “returned without a receipt, borrowing” or “wardrobing” (Grannis, 2014) merchandise for a few days with the intent to return the items is fraud. Using fake receipts to return old household items or fake coupons for reduced prices during a previous purchase to later return items full price for cash or credit elsewhere is losing companies 10.9 billion to return fraud in 2014. (Grannis, 2014). Return fraud is stealing and stealing means a financial loss.

WHAT RETAILERS CAN DO
Necessary recoupment measures can be initiated in many companies as they are seeing opportunity to regain the revenue they are losing. Preventative: By investing in monitoring and surveillance equipment and restructuring return polices as REI did in 2013 as they earned the nickname “Rental Equipment Inc. in internet searches they can attempt to prevent the monetary loss (Martinez 2013). Latent measures: Reverse logistics teams can find returned items new avenues for a second home by assessing potential values of used merchandise through resale, parts, recycling and donation. Together,

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