Why a $129 pair of shoes can cost a merchant $229 after a dispute
Why a dispute costs $229 on a $129 pair of shoes
Anthony Ross breaks down the real cost of a chargeback. A $129 shoe sale with no delivery proof triggers a $228.87 loss: the reversed sale, shipping, card fee, cost of goods, and a non-refundable $15 dispute fee. He contrasts this with card-present fraud, where the EMV liability shift pushes losses to the weakest tech link. Non-delivery disputes lack that lever, leaving merchants to rely on evidence.
The answer to who loses isn’t “the person who did something wrong.” It’s usually “whoever has the weaker evidence or tech” which is a very different thing, and it’s why disputes are so expensive.
- purplepatrick
Point taken. However, as the author works in FINtech, I’m feeling compelled to add that the revenue reversal figure itself is neither “cost” nor “loss” and should not be included in the $229.
- reitzensteinm
By double counting the loss of the item and the lost revenue you can really make a title seem worth a click.
- brudgers
For a few years now, I have a small potato business selling used electronic instruments online.
One important lesson is I have to charge more than the cost of postage to pay for shipping.