It’s no surprise that when a retailer encounters fraudulent orders it has a direct impact on their wallets. When a reseller receives an order through fraudulent means (for example, an order placed using a stolen credit card), they may have to request the order be canceled by the supplier, turned around while in transit or, in some cases, it’s a chargeback they have to deal with after it’s delivered. All of these potential outcomes wind up costing the retailer money, cutting into their precious profit margins.
But just how much money does fraud cost you, the retailer? A study from 2012 done by Javelin Strategy & Research and LexisNexis found that the average actual cost of having a fraudulent order had gone up $0.40 from 2011 to $2.70 per fraudulent order dollar. As an example if the fraudulent order you received was $10, it would have ended up costing you $27 once everything is said and done. That was almost 3 years ago. The numbers have only gone up.