5 Tips for Managing Holiday Chargebacks

By Michael Mallon, Director of Global Dispute Management Solutions January 14, 2016


A merchant’s joy from holiday sales can quickly evaporate when customers change their minds about purchases and request return authorizations.

History tells us the swell of holiday chargebacks usually peaks about four to six weeks after order fulfillment. Luckily, there are several things a merchant can do to minimize chargebacks. Now is a good time to prepare for the typical February fallout by considering these five best practices:

1) Calculate potential damage

Determine the potential fallout by analyzing your sales activity. Determine your average sales volume for the months of April through October, then calculate the increase of holiday sales during November and December. For example, if holiday sales rise 30%, it’s reasonable to expect dispute volume to rise about 30% from late January through early March. Track your sales by date as this information will help you plan for addressing chargeback disputes – those usually arrive up to 20 days before you must address their resolution.

2) Plan for addressing chargeback volume

Options for handling holiday chargebacks include hiring contractors or using alternative internal resources outside the team that handles chargebacks. For example, your company may elect to offer overtime for working early or late, or on weekends.

3) Prepare for unexpected issues

Stuff happens that may thwart your plans so prepare to be nimble. People get sick this time of year. It may be impossible to provide adequate training. And so forth.

4) Prioritize decision options

If the volume of disputes overwhelms your response capability, determine which disputes will be optional. Examples include:

  • Low dollar value
  • Fraud-based (unless your disputes are primarily friendly fraud/buyer’s remorse)
  • Reason codes you traditionally lose

5) Ask for mercy

As a last resort, you might ask your processor for a few extra days to finish resolutions. Processors may have flexibility to give you an opportunity to refute invalid disputes.

By following these guidelines, you can prepare for the inevitable swell of post-holiday chargebacks – and maximize your joy of retaining seasonal profits.

About the Author

Michael is the Director of Global Dispute Management Solutions at Accertify. Since he has not had to spend too much time this year shoveling snow in the Northeast, he dedicates his time to managing the company’s global chargeback management platform.