When Christmas Brings Retailers Many Unhappy Returns

When Christmas Brings Retailers Many Unhappy Returns
Bert Socket - Mon Dec 31, 2012 @ 11:23AM
Comments: 1
Now that the holiday shopping frenzy is almost over, merchants are bracing for a less-welcome wave of business: merchandise returns. But it’s not all those sweaters that never seem to fit right that are the big headache. Instead, post-Christmas marks the prime season for retail return fraud. According to a National Retail Federation survey, return fraud cost retailers an estimated $8.9 billion in 2012, with nearly 30 percent occurring during the holiday season alone. Overall, the survey shows that about 4.6 percent of holiday returns are fraudulent.

Of the 60 retailers surveyed, 96.5 percent reported being ripped off by criminals who collected refunds for stolen items this year, and almost half said they’d received counterfeit receipts. Nearly two-thirds of the retailers said customers had returned items they’d worn or used.

NRF spokesmen were not available for comment, but Vicky Brock, chief executive officer of Clear Returns, a Scotland-based startup that’s developing data analysis software to track and prevent retail fraud, shed some light on the costly problem of wear-and-return fraud. “A lot of people think that when they return something, it’ll go straight back on sale,” Brock says. “But it may never get back on sale—by the time it’s been sent back to distribution, repackaged, if it’s in a condition for sale, it could have been discontinued of discounted. In some cases, it’ll just get shredded.”

read more: http://www.businessweek.com/articles/2012-12-30/when-christmas-brings-retailers-many-unhappy-returns?

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