#31
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Thanks for the thoughtful and detailed reply Josh.
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Sonder MTB, Planet X Ti Gravel, Seven Ti, Lynskey Ti |
#32
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Just wait until you hear about our esteemed colleagues on this forum who purchase entire thousands-dollar bikes from Costco and return those!
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#33
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Eye opener for sure, thanks for taking the time to post. Unbelievable
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#34
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Not related to our original topic but this gets way worse for fraudulent purchases.. stolen CC# type stuff. The current trend/scheme in CC fraud is that they steal the card info and choose an shell delivery address in the card zip code to use as a shipping base. Then buy a bunch of stuff, send it to the address and steal it from the porch when it arrives. The person who lives there often has no idea the stuff is missing as they never ordered it (and often they've scoped our the home of an individual who travels or works long hours, etc). The fraud detection from the CC company is reported as low as the shipping zip matches billing zip (it really is that primitive) and it generally takes about a month for the card holder to notice and then call and cancel and by that time the scheme has moved on. The CC companies are impossible here as they won't even verify addresses if you call them.. and why would they, the make more in fees for fraud than they do in legit transactions! (this happens to us about 4-5 per month at various price points) So: scammer buys an ultimate pump for $500 on stolen card. We get $475 after CC fees and fully subsidize the $30-50 shipping for a 30" long, 8lb item. Item delivers, photo of delivery taken by FedEx driver on porch. Then the item is stolen.. 3 weeks later the original card holder realizes the fraud and reports. They get $500 from the CC company. The CC company contacts us to see if we want to dispute this claim. We have the receipt showing low risk of fraud (as predicted by the CC company!!), the shipping receipt with tracking, and the proof of delivery (with photo) from the driver and enter it into their dispute system. They then almost immediately deny this because the address is NOT the address of the card holder, nor is it associated with any prior purchasing behavior (which they knew all along but won't verify even if we call them). But here's where it gets good: they then bill us for the original CC fee of $25 that they just had to refund to the CC holder, AND they bill another 2% for 'claims processing of fraudulent order' AND they bill another $25 straight fee for filing a rejected dispute. So, in the end we (or any other e-commerce retailer, and everybody is struggling here) have: 1. Lost the entire value of the original item 2. Lost the subsidized shipping and packaging/labor expenses (boxes, tape, labor, etc) 3. Had to cover the original 5% CC fee 4. Had to cover the 2% claims fee 5. Had to cover the $25 lost dispute fee So why doesn't the CC company care to try and help companies end this type of fraud? (and I've spent hours on the phone arguing with them over this when trying to determine if an order is real or not.. first time customer buys 2 Ultimate pumps, I'd kill to know if the shipping address matches the billing address of the card as the companies only tell us if the zip code matches). In this case of this Ultimate pump fraud (had 1 last month) the CC company will make $60 in fees from the sale being fraudulent compared to $25 from it being legit, while looking like a hero to the CC holder.. and internally they were able to know this was in fact fraud in less than a second when the computer verified that the ship to address was not related or known to the card holder's previous purchasing behavior. All the while, the company (us in this case) has lost all of the original revenue from the sale, paid $60 in fees, lost the entire value of the product plus shipping materials, labor and the shipping expenses. Spent an hour collecting all of the order history, tracking, delivery confirmation info, photo, etc and painstakingly compiling it into the automated form provided by the CC company and so on. We will have to sell 2 more ultimate pumps just to break even on the lost value and expenses from this 1 fraudulent sale. Leverage of these fees and penalties has sadly become another tool used by the fraudulent returners of items.. in the above I mentioned the bike returned with replaced components.. in addition to the retailer losing the value of those items plus the original 5% CC fee, they have to chose to risk losing the entire value of the sale plus additional fees in the dispute process, and the fraudsters know this. So if the retailer won't refund the full original amount or tries to dispute, then the fraudster goes to the card company to cancel the whole transaction, original retailer gets hammered with fees AND has to provide proof of 'not fraud' which is nearly impossible unless you have videos of you building, packing and shipping the bike as well as those showing you unboxing what came back (I know at least 2 big retailers who are now doing this to give you an idea of how big the problem is..) |
#35
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Thanks Josh! eyeopening for sure.
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#36
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Wow. That is some amazing insight that has been provided. I am shocked at the lack of regulation in the credit card industry around these issues and in regards to how merchants are coerced.
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Cheers...Daryl Life is too important to be taken seriously |
#37
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Wow!
Thanks so much to Josh for typing all this up this morning. I have learned a lot and had no idea such things were taking place regularly. Makes me realize just how much the deck is stacked against small to medium businesses. It's so sad that fraud and bad actors are so common and an accepted part of doing business for places like amazon and the CC companies. Crazy really. Who knew there were that many scumbags on the planet.
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http://less-than-epic.blogspot.com/ |
#38
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Cheers...Daryl Life is too important to be taken seriously |
#39
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I have been aware of these issues with Amazon. I don't purchase anything from them, but my wife.....
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#40
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Generally speaking, I think most people who work for a living just want to do a good job, make a decent paycheck and live a nice life. The people who are showing up for work, doing their jobs and following the rules are certainly not the scumbags of the world. It gets a little trickier at the upper management level. By the time you get up there you're caught up in the corporate machine and driven my profit profit profit and it becomes harder to do the ethical thing when the choice comes; so when it comes to dictating policies on fraud and returns for small businesses, and essentially letting crooks get away with theft, that's a blurry line on the scumbag meter. Those guys are just trying to make their bosses and stakeholders happy and keep making a paycheck. The real scumbags are the ones stealing packages off porches, returning chain lube containers with milk in them and otherwise taking advantage of an imperfect system. The other question is who the hell does this? What kind of a sick sociopath actually orders a bottle of chain lube, and processes a return with an empty bottle? Does someone really need that super secret lube that bad to do something like that? I suppose some people can hide their crazy, but I cant think of anyone I've ever met who might fall into that category, but maybe i'm being naive
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http://less-than-epic.blogspot.com/ |
#41
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Josh's post is too good to lose.
Anyone know someone at Cycling Independent ? Now we have Amazon Trolls to go with our internet Trolls. Last edited by sg8357; 07-20-2022 at 08:33 AM. |
#42
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Every time he posts l like the brand a little bit more. Call me a fanboy. Whatevs. Silca rocks.
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#43
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It’s easy to go deep in the weeds on this stuff for some it would seem. I have only ordered pump parts from Silca, and they are easy people with whom to do business…I really don’t care what the policy is, I am sure if there is an issue that they will make a fair attempt at putting things right.
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#44
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awesome insight!
So, if i read Josh's post correctly, they actually like being an Amazon retailer? I say that as it seems to financially work out better in the end for them, I think? Maybe I missed something though.. I can get what Josh is saying about scumbags bringing back severely used items.. when I worked part time at the Performance store in San Diego, I had a guy try and return a set of tires that were clearly used for a several hundred miles (prob 1000+), maybe had 30% use left on them.. I asked my manager what I should do as the complaint was "they didn't work for me".. the manager said take them back and give a full refund. I did and then asked my manager why we would do such a thing? His response was that that set of tires cost the company less than the possible loss of customers/reputation if that customer went online/etc and badmouthed the store and cost future sales. While frustrating, I can understand his point.. I can also see and support 100% Silca's store credit return policy.. just amazing what folks will do to try and game the system..
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Be the Reason Others Succeed |
#45
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Thanks for the reply Josh.
SUPER interesting look into what a small company goes through and how the Amazonization of the buying process affects businesses. They force you into bed with them by not taking action with counterfeiters until you sell with them. But then, they seem to give you a lot of benefits like easily making you whole on fraud. What an insane system of waste and deceit. Your reply should be widely distributed as a case study, and would turn into a cool article for a site like Cycling Tips. |
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