How to Protect Your Business Going Forward

When COVID-19 first hit and the fitness industry adapted, we found success with online models, client connection and a new way of life. What have we learned? Anything can happen! Get prepared with a bulletproof strategy to hold onto your revenue and protect your business going forward.

You’ve made it through the pandemic with your business intact, but can you withstand the next crisis? To prevent chargebacks, fraud and suspicious transactions, you need a solid strategy in place to help safeguard your business!

What are chargebacks?

A chargeback is a charge on your client’s account that they dispute with their financial institution, claiming that it’s either incorrect or unauthorized. Rather than requesting a refund from your business, the bank removes the money directly from your account. Generally, customers initiate a chargeback dispute 90 to 120 days from the date of purchase. This system is meant for consumer protection, but it’s often over-used, leaving businesses unprotected and at a loss.

Why does a chargeback occur?

There are several scenarios where your client can initiate a chargeback dispute, here are a few of the more common reasons this occurs:

• No credit issued: When a client requests a refund or return that was not processed.
• No receipt: When no receipt is provided, so the transaction isn’t recognized by the client.
• No authorization: When the client cancels authorization for a repeated withdrawal or they dispute its authorization in the first place.
• Repeated charge: When the client is charged more than once for the same thing but has only authorized one transaction.
• Buyer’s remorse: The client has changed their mind about the purchase.

What if I experience lots of chargebacks due to COVID-19?

Credit card companies and banks are keeping a watchful eye and monitoring chargebacks closely from businesses that have been recently closed. Pandemic aside though, chargebacks are always a serious concern for your business because it makes you a higher risk with creditors, leaving you open to the following action on your account:

• The processor delaying funding
• Your funding being held
• Paused processing
• A suspended account

Keep your chargebacks low to successfully manage your business without interruption.

How to prevent chargebacks

Avoid chargebacks wherever possible with a proactive approach! Here are two ways to lower your chargeback stats, keep your clients happy and stay in good standing with creditors:

• Contracts: Give clients a clear understanding of your terms with member contracts. Include transaction amounts, frequency, end date and cancelation policy. It’s tricky for them to dispute a transaction when they’ve already signed their agreement.
• Receipts: Print or email a receipt after every transaction to give your clients proof of purchase and a reminder of the charges they authorized.

Take steps to avoid chargebacks altogether and successfully protect your business.

Accepting payments from suspicious new clients

Don’t become a victim of fraud!  Many businesses fall prey to phony purchases when people pass off stolen credit cards as their own. These purchases can include anything from gift cards to memberships, so stay alert. Look for suspicious requests like a refund to another method of payment or to a different credit card.

Don’t let your desire for revenue during economic uncertainty increase your risk of fraud. Know what to look for to lower the chance of getting scammed, losing revenue and risking the security of your business.

Don’t click on links in suspicious emails

Stay vigilant with your email, too. According to the experts, small businesses lose almost twice as much as large corporations each year to data breaches and fraud. By opening up suspicious emails or clicking on links you don’t trust, you’re risking social security theft, tax identity theft, data mining, viruses or lost control over your accounts.

Here are a few ways you can avoid being taken in with an email scam:

• Make sure you recognize the sender’s email (if you don’t, mark the address as spam and delete the message).
• Hover your mouse over the link (without clicking) to reveal the source information.
• Search the Internet to confirm the sender’s contact info.
• Regularly change your passwords so your access stays secure.

Do your best to protect your business by becoming fraud savvy, skipping suspicious emails and only dealing with businesses and clients that you know and trust.

Communication is key

The best way to protect your business is to maintain steady and open communication with your clients. Avoid any misrepresentation or confusion and work together when there’s an issue. Be upfront with your refund or cancelation policies for memberships, sign-ups, and appointments. Post your policies, include them on your receipts and verbally communicate them during each transaction. Happy clients don’t tend to go the chargeback route, so build your relationships to build your business. Having a plan and taking a proactive approach to hold onto revenues will prepare you to protect your business going forward.

At WellnessLiving, we’re there for you to ensure your clients are happy and your business continues to grow! From the Achieve Client App to our loyalty rewards program, our all-in-one software offers you the tools you need. Book a no-commitment demo today to learn more!