Shipping fraud and theft in 2020: the scams draining your profits

As online shopping became more popular there has been a significant increase in porch pirates and shipping scammers.

Recent research showed a 22% increase in package theft between 2016 and 2018, and a 131% increase between February and March of this year. With Christmas around the corner and contactless deliveries set to continue, the future doesn’t look bright.

It’s not just your customers that suffer either. Shipping fraud and delivery theft cost eCommerce businesses significant time and money to rectify. And, even once you’ve resolved it, your brand can still suffer negative reviews, reputational damage and lost custom – making you a victim too.

In this article, we explain the delivery fraud and theft to look out for and what your fulfilment operation can do to minimise the risk and consequences.

Shipping fraud and delivery theft

When you think of fraud and theft, it’s easy to think of big jewellery heists and multi-million-pound banking scams. The reality is a lot smaller and much closer to home.

eCommerce fraud is growing faster than eCommerce sales, and it isn’t just a problem for your sales or finance departments. The following forms of shipping fraud and delivery theft are growing just as quick:

Doorstop theft

The most common type of shipping theft is doorstep theft, where a thief steals a delivered item from someone’s doorstop, post box or secret hiding place. With branded packaging more common and online orders more expensive, doorstep theft is a common occurrence, especially recently with the rise in COVID contactless deliveries.

Receipt fraud

Receipt fraud is when a customer fraudulently claims they didn’t receive their order and receives either a replacement or full refund. This usually occurs when sending orders untracked and unsigned for, however, again, COVID contactless deliveries have caused a spike.

Interception fraud

Interception fraud is a little more complicated. A criminal purchases items on a stolen credit card, using the registered billing address. They then intercept the parcel either by contacting the shipping carrier to amend the delivery address or waiting to pounce on the doorstep.

Returns fraud

The growth of online return rates is causing a spike in online return fraud too. Returns fraud takes two different forms:

  • Wardrobing – using an item before returning it for a full refund.
  • Non-posting – fraudulently claiming an item was included in a return.
Internal theft

Finally, we can’t leave out internal theft. Intentional or inadvertent theft by employees, contractors or partners can occur during any stage of the supply chain and take many forms. 

Protecting your business

Thankfully, there are many measures to implement that protect your business against theft and reduce the chance of fraud taking place. These include:

1. Offering multiple delivery options

When you offer customers a variety of delivery methods, they can choose the safest option for them. This could be nominated day delivery, click and collect, or expedited services. The key here is delivering what you promise, so if you can’t provide next-day delivery in-house, it might be time to consider a 3PL.

2. Packaging items with care

Packaging is a huge contributor to parcel theft – the more exciting and expensive it looks, the more likely someone is going to want it. Well packaged and clearly labelled parcels almost go without saying – the sticking point in your business is likely to be branded packaging. While there’s a lot of hype around unboxing experiences, branded packaging loudly advertise what’s inside. Consider using plain packaging and keeping your unboxing experience inside the box.

If your fulfilment provider isn’t packaging items with care, it might be time to think about changing 3PL.

3. Using a reputable shipping carrier

A reputable shipping carrier is crucial for so many reasons, one being theft. Choose a shipping carrier that provides adequate insurance for a parcel’s contents, has a glowing reputation from customers, and goes above and beyond to ensure parcels land in the right hands.

Relevant resource: Considerations when choosing a courier

4. Tracking deliveries

Tracked deliveries aren’t just great for keeping you updated and your customers quiet; they also enable customers to arrange receipt of their package. This is especially important in high-theft areas. If you don’t provide tracking information as standard, allow customers to upgrade to tracked deliveries on the checkout page.

5. Perfecting the handling returns

Return scams often go unnoticed because returns are processed and refunds swiftly issued before the fraud comes to light. At Synergy Retail Support, as returns arrive, they are scanned, quality inspected, logged and repacked – allowing us the time and you the data to immediately identify any suspicious activity.

Read more: Reverse logistics – the state of eCommerce returns in 2020

6. Using an eCommerce fulfilment partner

Handling the operations of a growing eCommerce business is challenging, especially when fulfilling orders in-house. By using an outsourced fulfilment partner, you gain immediate access to expertise on quality control, shipping carriers and ways to reduce shipping fraud and delivery theft, not to mention more time to tackle the root causes of the problem.

Final thoughts

Perhaps the most important tip of them all is making it easy for your customers to contact you. Shipping fraud and delivery theft can seriously impact your brand image. However, the quicker you can resolve the customer impact, the faster you can minimise the reputation damage.

About Synergy Retail Support

Synergy Retail Support is an eCommerce 3PL, helping you to streamline, improve and manage your eCommerce fulfilment. We work with large to medium brands, powering them to achieve online success through meticulous quality control, high-standard packaging, fast shipping and efficient returns.

To find out how we can help your business, get in touch.

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Gary Rees

Gary Rees

Gary Rees is the owner of Synergy Retail Support, one of the leading SME fulfilment centres in the UK. Having successfully grown the business for over 30 years and with relationships with most household brands, he now looks to partner with customers rather than just act as a supplier so that both parties can grow together. Gary has extensive knowledge in retail compliance, production technologies, shipping details and customer service.

Feel free to contact me personally if you’d like to discuss your business.

gary.rees@synergyretailsupport.co.uk
+44 (0)3453 402 980