7 Key Steps To Reduce Refunds and Chargebacks


One sure-fire way to loosing out big time on your business profits is from incidences of excessive refunds and chargeback requests. If the number is high in any period you could risk loosing your third party merchant account altogether. So what do you do when there are some who will request a refund within 15 minutes of purchasing your product? Or even more pettier are those who will wait until the last possible moment to request a refund. Well not all is lost because merchant account providers are very well informed as to the credit card numbers of persistent refund and chargeback claimants. Just like their list of fraudulent credit card users, stolen credit cards etc they have a database of what I call "Refund Junkies". There appears to be no end to the unethical tactics some people will use to get your product for free.

Use the following tips to further safeguard against refunds and expensive chargeback costs. The good news is that refunds are easy to process and do not carry any additional fees. However as a merchant you want to ensure that refunds are kept to a minimum.

1. Clearly State the Billing Name

First and foremost state the name of your third party credit card processor on your sales pages and include them in your terms and follow up email receipts sothat customers are fully aware of what company name will appear on their billing statements. This will reduce the number of customers who do not recognize the billing name on their statements from contacting their credit card issuers for a chargeback. This one factor can lead to an unprecedented number of chargebacks claims.

2. Provide Your Customer Support Details

Provide your email address so that customers can contact you regarding any queries about their order. Make sure that you answer them in a timely manner to avoid unnecessary delays. If a customer is not responded to promptly they are very likely to make a refund request.

3. Offer Lifetime Updates

Offering your customers lifetime updates to your product and services to add value and will encourage them to remain customers in the knowledge that they will always receive your most current edition of your goods.

4. Reward Loyal Customers With Exclusive Privileges

Offer your customers a product that can be used freely as long as they are fully paid members, as part of a membership site. Or use a tool which is only available to customers and cannot be accessed after a refund request is made. As long as your offer is valuable to your customers and members you are will substantially reduce the number of refund requests.

5. Provide The Best Guarantee
Your guarantee could become a thorn in your side if you have a very short time span before customers can test out and use your product. But studies show that the longer the guarantee period the less refund requests are made because customers are more comfortable with their rights to cancel if the product or service does not meet their needs.

This is at your discretion as a merchant so testing is important to work out what is best for you. Remember to take into account that some third party processors have a limit on the maximum refund time their merchants can issue to customers.

6. Accurate Product Descriptions
Avoid making bold claims that are "too good to be true" if you cannot deliver the results. You could be setting yourself up for a big fall and your customers will request refunds if your product description does not fulfill their needs. You could also be breaking the law and be liable to charges if a law suit is brought against your company. Make sure your sale letter accurately reflects your goods for sale and highlight the TRUE benefits of owning the goods.

7. Surprise Bonuses

It is a great surprise when you buy something and receive additional unadvertisedbonuses. This can warm your customers to your company and can only please them. It also demonstrates that you do not need to publicize your bonuses because you believe in your product so much that it will sell on its own merit.

Dispelling Myths

All too often I have read articles and statements claiming that with third party merchant accounts there are no chargeback fees and that you never have your company name display on customer statements. These claims are inaccurate.

The facts are that some do not have chargeback fees. I have personally researched 90+ third party processing companies and have contacted them to verify certain key points in their terms of contract and fee schedule. There are some third party processors that do not issue chargeback fees or refunds, such as can be found with some digital gold currencies. In this case the merchant must initiate a refund directly to the customer.

There are some third party processors who do not levy chargeback fees but you will find that these are very few in number and they will typically have a higher processing fee to cover their costs. Don't be mistaken in thinking that third party processors do not pass on chargeback fees to their merchants. You only have to read their terms in full to find out exactly what you can expect to be charged for per chargeback incident.


More Resources

Unable to open RSS Feed $XMLfilename with error HTTP ERROR: 404, exiting

More E-Commerce Information:

Related Articles

Grow your Business with Emarketplace - Part III - Ecommerce
Ecommerce Information

Grow your Business with Emarketplace - Part III


Increase Company Productivity

After years of hard work, finally your business started to pick up. You are selling more products then ever! You have lined up a good number of suppliers and buyers. Things have never been better than now. Except one thing! With rising sales your overhead and supply chain expenses are also sky-rocketing. Your profit margin is no longer the same as it used to be! You feel that you are in a limbo! How to increase productivity? How to cut costs without giving up sales?

Sounds familiar to you? Well, your company is not alone! According to IDC, a research firm, while interviewed, overwhelming majority of the company executives claimed that their biggest concern is declining profit margins.

Companies, in order to stay competitive, must find solutions to increase efficiency in business operations and control costs. Is there a solution to this ubiquitous problem?

Remember Dorothy from the children classic "Wizard of the Oz"? She had to go through numerous obstacles in her quest to find a way to get back to Kansas, her home. Only to find out that the silver shoes that she was wearing from the very first day since the cyclone brought her to the Land of Oz could have taken her back home, all she had to do was to knock the heels together three times and command the shoes to carry her wherever she wished to go.

Similar to this story, solutions to these corporate problems are widely available right under your nose, only you as a company executive have to overcome the fear of new technologies and adopt them to your own good.

B2B exchanges or emarketplaces are capable of solving many key problems that corporations are facing today. Emarketplaces can provide immense opportunities to automate supply chain process, increase operational efficiency, reduce overhead costs and expand market at a minimal cost.

Using emarketplace effectivelyTwo primary factors of company productivity are Revenue Increase and Cost Cutting. Both are achievable if a company seriously decides to incorporate emarketplace features in all aspects of business operations. That means if as a company you want to reap all the benefits of emarketplaces, you have to commit yourself seriously.

Become a memberOnce you find an emarketplace that suits your requirement, the first thing what you have to do is to register and become a member.

Most emarketplaces have different membership packages. Although, to check out the emarketplace - whether it is viable for your business or not - you might start with the free membership package, but once you are satisfied with your selection, to use the emarketplace to your advantage you should choose the package with most features and functions.

Integrate your products to e-catalogIf you are a supplier, this is a very important step to take. Unless you have thousands of products to sell, this should not be a difficult task. All emarketplaces use either a form or wizard-based, not-so-complex and user-friendly product adding tool. Since e-catalogs that emarketplaces use are industry standard, once you aggregated you products, same information you will be able to use in other e-catalogs, emarketplaces and even in your own website.

Apart from your own buyers other prospective customers from the emarketplace community are able to view your products in the e-catalog, which in turn will bring you new contacts and sales.

Create products for sale offers You should create sales offer of your primary products that you carry most of the time and post them on the emarketplace. Many emarketplaces have options to sell products with different procedures. You can make offer to sell access inventories through dynamic market, also called auction, you can make hot offers with time limit, etc.This is an extra sales channel in the beginning, which might grow into your primary one!

Involve your buyers and sellersIf you would like to use an emarketplace most effectively, youhave to get your suppliers and buyers on board too. Supply chain management solution that usually comes with an emarketplace allows you to reduce operational costs significantly.

- Encourage your buyers to send request for quote for a product through the inbuilt system of the emarketplace.
- Make strict rules within your company to send all quotes exclusively through emarketplace.
- Ask your buyers to send Purchase Orders to your company via emarketplace.
- Bill all your clients using invoicing system of the emarketplace.
- Manage shipping and handling though emarketplaces.
- Convince your suppliers to use the same emarketplace so that even as a buyer you can get the benefits of a B2B exchange.

Complete adoption of an emarketplace will help a company gain numerous benefits. The following figures taken from various research notes emphasize the importance of e-marketplace in today's business world.

- Thanks to emarketplace, companies can reduce purchase order processing cost from US $75 to less than US $10.
- By automating sales and customer support processes companies can lower overhead costs up to 25 - 30% easily.
- Companies also can reduce more than five percent of their maintenance, repair and operation by incorporating e-business solutions, which are integral parts of any emarketplace.
- Business process automation using B2B emarketplace helps companies decreasing of document errors from 20 percent to less than one percent.

B2B Emarketplace solutions are great opportunities

The famous inventor Thomas Edison once told, "Opportunity is missed by most people because it is dressed in overalls and looks like work."

Company executives are by no means afraid of hard work, but unfortunately many of them have colossal fear of high technology and because of this reluctant to explore new Internet-based technologies to their advantage. If you are one of them, be assured that knowledge required to adopt emarketplace to your business and manage it properly is easy to learn and implement.

Nowshade Kabir is the founder, primary developer and present CEO of Rusbiz.com. A Ph. D. in Information Technology, he has wide experience in Business Consulting, International Trade and Web Marketing. Rusbiz is a Global B2B Emarketplace with solutions to start and run online business.You can contact him at mailto:nowshade[at]rusbiz.com, http://ezine.rusbiz.com, http://www.rusbiz.com

MORE RESOURCES:
Unable to open RSS Feed $XMLfilename with error HTTP ERROR: 404, exiting 		RELATED ARTICLES
Web advertising e-Marketing Places!
Overview:What is web advertising?Internet Advertising is popularly known as web advertising. Internet webadvertising giving Opportunity to the advertiser to target geographic country wise, subject wise, targeted Customers only from more than 200 countries worldwide.
Online Business- What Makes It a Success!
Only a few manage to sell everything under the sun over the internet. There are billions of web sites running online business, trying to outdo each other by various means.
What Does It Take to Make Money Online?
What a loaded question! Let's narrow that down a bit and take it from the perspective of someone who wants to work from home and make money online in a home business. That will make it an easier question to answer.
Set Yourself Apart From The Ordinary
I have written at length about the need to anticipate your visitors' needs. I have talked about how the first screen of the homepage needs to connect immediately and directly with the task each visitor has on his or her mind.
Credit Card Processing - 7 Things You Need to Know Before Opening an Online Merchant Account
When considering opening an online merchant account to accept credit card orders, there are a lot of things you need to keep in mind. The best thing to do is learn all about credit card processing before you open your online merchant account so you can handle everything from the beginning rather than having to go back and make many changes.
Choosing an Ecommerce Shopping Cart
Choosing an online shopping cart is a big decision. Unlike a traditional brick and mortar business, your website is your only chance to impress potential customers.
Evaluating Vendors of Ecommerce Fulfillment Services
Once your website has secured an order, you have to fulfill it. While the fulfillment of digital goods is usually handled online, the delivery of physical goods is handled in a "brick-and-mortar" world.
Outsourcing Your Ecommerce Order Fulfillment
When your eCommerce business grows to the point where you can no longer package and ship the orders yourself, it's time to begin outsourcing your order fulfillment. Although all order fulfillment centers offer the same basic services, their individual methods and costs will help you choose one over the other.
E-commerce Software That Will Safeguard Your Business against Fraud
Fraud is a huge issue when it comes to the Internet, and if you operate an e-commerce website then it should be one of your main concerns. Your potential customers will not want to buy from you unless they feel 100% certain that their information is encrypted and secure and that their credit card numbers will not be stolen in the order process.
Business Online - Blind Hunt
Do you sell something online? Do you have a business in the Internet? Have you read the "How to generate more traffic and convert it to sales" articles? Have you played the "Be #1 in SEO" game?Now, you are ready to believe - nobody knows how to do it absolutely right.Nobody can know everything.
Building eCommerce Websites That Work - Part 1
You want to succeed at eCommerce? Welcome to a very big family. Right off, let's be clear - there are lots of ways to do business on the internet.
Selling From Your Website
Greetings!Friends and relitives ask us all the time " How do sell from your website?" and no doubt you want to know as well. Over the next two issues we will be covering this very thing! We decided to divide it into two camps - tangibles and non-tangibles.
Creating The Perfect Ecommerce Website
If you're thinking of jumping on the bandwagon and going into business with your own ecommerce website, you'd do well to look at a few examples before you start. Finding out what a good ecommerce website looks like will help you know what to include - and what to avoid - when you start to set up one of your own.
Online Shopping: Legal Challenges for Taxing Authorities
E-commerce offers customers the chance to eliminate many stages in the sales/distribution chain. The mark-ups that occur between manufacturers, wholesalers, distributors, retailers and consumers can add the cost of goods purchased by consumers.
10 Reasons Why People Wont Buy A Second Product From You
1. You didn't follow up after the first sale.
Say Something Worth Talking About
I recently published a short e-book called 'One Thing I Know About Doing Business Online'. Seventeen people contributed - including Seth Godin, Jeffrey Zelman, Danny Sullivan, Jared Spool, Gerry McGovern and Ann Handley.
Credit Card Merchant Account Basics
Knowing which credit card merchant account to get can be very confusing. There are thousands and thousands of banks, merchant account providers and third party sales teams that can offer you all kinds of incentives.
Online Customer Service - The Cornerstone of a Successful Online Business
Online customer service is still one of the most frequently overlooked aspects of running a successful online business. Yet, in the highly competitive world of Internet business, it could be (and should be) the one thing that sets you apart from your competition!Most Internet businesses that have a drive to succeed focus all of their time and resources on building a great site, and then trying to drive tons of traffic to that site.
Is Your Business Afraid of the Internet?
My Business is Afraid of the InternetBill Gates, CEO of Microsoft, once said that there would soon be two types of businesses, those online, and those out of business. Those words still ring true today, and many small businesses are missing a huge boat by not getting online.
The Top 10 E-Commerce Ways to Follow up with Clients - Part 1
Did you know that 80% of all sales are made after the 5th contact? The biggest mistake we make is not following up with our clients regularly. We not only lose the chance to offer other services and products, we lose the chance for satisfied clients' referrals.