Retailers and suppliers in Australia are facing a losing battle with return fraud now a big issue as consumer are being caught swapping out real products for fakes.
In the UK Australia and the USA retailers are struggling with the issue with one retailer losing more money on fraud than they made in profits.
In the USA return fraud was more thanA$145 billion in losses for sellers according to the National Retail Federation.
Returns are averaging 14.5% and of those goods returned 13.7% of those returns have been found to be fraudulent, NRF executive director of research Mark Matthews told Fox Business.
“Moreover, for every $100 in returned merchandise, retailers will lose $13.70 to return fraud,” the NRF reported.
In Australia organisations such as NARTA are working with the likes of JB Hi and The Good Guys and Bing Lee and suppliers as well as outside security agencies such as Federal and local police forces to tackle the issue.
Sometimes, the scam involves abusing a merchant’s return policy, including returning stolen merchandise or counterfeit items, or sending a product back after it’s been used — a concept called “wardrobing” that’s one of the most common types of return fraud, according to retailers.
In Australia people have been caught out buying a product such as shoes and dresses for a wedding, formal or special event only to return it days later. Some have been caught out via their social media accounts.
In other explicit versions of the con, shoppers claim they never received an online order so the retailer will send them another one — free of charge, this has led to delivery drivers photographing delivery of goods.
To make matters worse, there isn’t any indication that the problem is going to go away despite retailers’ efforts to thwart returns with initiatives like paid returns and more detailed product descriptions claim suppliers.
Logistics firms have started charging customers a fee to ship back or return an item they don’t want.
Amazon has also started charging customers to return items.
In Australia retailers have sought to take action themselves to prevent in store crimes by, locking items up behind theft-proof barriers, though the move has triggered a new problem as customers now have to wait for employee assistance to access their goods.
In response to the long wait times, a TikTok who goes by @real_ogjr devised a “life hack” that circumvents the lock-block for certain items — by ripping the whole rack off the shelf.
In the clip, taken at an undisclosed store, the influencer can be seen approaching a shelf with a rack of items that are protected by a red button security lock.
“If these things are here, and you also need a worker, well you don’t need a worker,” he declared. He then grabs the metal hanger and detaches it from the wall, before sliding the desired item off the other end, which is not under lock and key.
He explained in the comments of the TikTok clip — which has racked up nearly 700,000 views since it was posted last month — that he busted out the anti-anti-theft technique after his sister struggled to find an employee.
