Chargeback
When a customer calls their bank and says "I didn't authorize this" or "I never got my stuff." The bank yanks the money back from you. Unlike a refund — where you decide — chargebacks happen without your consent, and you get hit with a $15-100 fee on top of losing the sale.
Example
Someone buys an $85 jacket from your store. Two weeks later, their bank pulls the $85 back. You lose the $85, pay a $15 dispute fee, and the jacket is gone. Total hit: $135 for one order.
Why It Matters
A single chargeback costs you 2-3x the original order amount once you factor in the lost product, the dispute fee, and the non-refundable payment processing fee. At scale, chargebacks can quietly erase months of profit, and if your rate gets too high, you lose the ability to accept payments entirely.
Pro Tip
For every chargeback you receive, respond within the deadline with tracking info, delivery confirmation, and any customer communication. Winning even 30% of disputes is like found money.
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