Every business that accepts credit card payments deals with chargebacks to one degree or another. That degree is affected by a variety of factors. Some of them are inherent to the industry, such as the type of product or service. Some are specific to the individual business, such as the quality of customer service. In most cases, a business’s susceptibility to chargebacks is determined by some combination of the two. This is especially prevalent when it comes to firearms businesses and susceptibility to chargebacks.
Firearms businesses and their susceptibility to chargebacks are one of the main reasons it is considered a high risk business. The higher the susceptibility of a business to chargebacks, the higher the likelihood that the business will be considered by banks and payment processors to be high risk. This is the case with gun shops and other firearms-related businesses.
What is it about firearms businesses that makes them more susceptible to chargebacks? What can you do to reduce that susceptibility?
Some type of dissatisfaction with the purchased product or service is often the reason that a customer wants a refund. Except in cases in which the problem is an actual defect in the product, this generally boils down to the amount of knowledge the customer has regarding the product prior to making the purchase.
Are these shoes the right size? Does this car give me a smooth and comfortable ride? Do I look good in this hat? Part of the process of making a purchase is deciding whether or not the product or service is a good “fit” (whether physically or in the sense of meeting your needs). That decision is easier, and more likely to be accurate, if you are able to “try before you buy.”
Naturally, some products and services are easier to try out than others. Trying on a pair of shoes in a store is easy. Seeing how much you like a Caribbean cruise without actually buying a ticket, making a reservation, and taking the cruise is a bit more of a challenge. This is a big factor in what makes firearms and their susceptibility to chargebacks a challenge.
The difficulty of trying out a firearm prior to buying it is probably somewhere in between. When buying a gun, especially if the intended purpose is personal protection, it’s always advisable to find a way to try out a variety of sizes, calibers, models, etc., or at least the one you are leaning toward.
When thinking of firearms and their susceptibility to chargebacks it is important to consider specific situations. If you are at a gun shop, you can hold the gun and examine it closely. You can get a sense of how it feels in your hands. However, there can be an enormous difference between the way an empty pistol feels in your hand in a store and the way it feels when you fire it and feel the recoil.
The way it feels changes again after you have fired a couple of hundred rounds while practicing at the range. Responsible gun ownership and use require proper training and practice, and it’s unlikely that getting a sore hand every practice session will be very motivating.
Unfortunately, that advice is not always taken, even when it’s possible, and one of the results is a higher possibility that the customer will be dissatisfied with the purchase. That means a higher possibility of a chargeback.
Another factor is the price of firearms. Although there is a wide range of products available, including guns that are of good quality while remaining relatively affordable, a handgun of decent quality will still start at $250 to $300 new. Well-known brands such as Glock or Smith & Wesson can cost much more.
A customer might not think that a $5.00 purchase is worth the bother of requesting a refund or initiating a chargeback, but will probably be motivated more if it cost $500. Your business could be more susceptible to chargebacks if you deal in relatively expensive goods or services.
As happens frequently in the case of high-dollar purchases of non-necessities, a $700 Sig is a good candidate for buyer’s remorse, especially if you find out that junior needs braces a month after bringing home your new pistol. The quality of the product and the customer’s degree of satisfaction have less to do with this than does the customer’s financial situation, etc., but there are still things that you can do to lessen the likelihood of it turning into a chargeback. Learn more about how firearm pricing is changing.
Directly related to the high price of many firearms is the fact that guns are one of those things that gets a reaction from wives that is some form of “You bought a what?!” or “You bought another one?!” If the customer has successfully postponed the inevitable for long enough, he may have missed the deadline for returns. That increases the risk of a chargeback. You might be better off in the end if you have some flexibility and give a refund.
As with other types of business, having a clear and easy-to-understand returns/refund policy is one of the most important things that you can do to reduce the risk of chargebacks. It’s also one of the easiest. Create it, post it in plenty of locations, and go over it with the customer at the time of purchase.
Making it easy for the customer to contact you is also a good idea. You may be able to answer some questions, give some advise, or otherwise help the customer have a better experience with the purchased firearm. If you find out what the customer doesn’t like about the gun he purchased, you might be able to recommend a different item and save the sale with an exchange.
Be sure to emphasize the importance of “trying before you buy”, especially in the case of first-time gun owners. Salespeople usually want to finalize the sale right now, while the customer has momentum in that direction, but that isn’t always the best course of action in the long run. Five sales that don’t end in a refund or a chargeback are better than ten that do, so be sure to have patience.
Losing a sale today could end up giving you a long-term loyal customer who was impressed by your desire to make sure that he got exactly what he needed. Even if a customer ultimately regrets buying something, you don’t want him to regret buying it from you.