10 Ways to Avoid Chargebacks in the Bicycling Industry

Let’s face it: Chargebacks are a total drag. They cost you money, burn up your time, and can even ding your business reputation. And, if you run a service shop, the last thing you want is to deal with chargeback headaches while trying to keep your customers wheels turning.

The good news? Many chargebacks are totally avoidable. With a few smart strategies, you can protect your business, keep customers happy, and stay focused on what you do best: Delivering top-tier cycling experiences. Here are 10 ways to avoid chargebacks:

1. Excellent Customer Service Goes the Distance
   

   About 18% of chargebacks are tied to customer dissatisfaction. Whether you sell bicycles, offer tune-ups, or rent e-bicycles, make sure your service is as smooth as your best-selling derailer. Quick response times, knowledgeable staff, and a clear process for resolving complaints can help you nip chargebacks in the bud.

2. Use Front-End Fraud Filters
   

   Cycling gear isn’t cheap, which makes it a target for fraud. Use the AVS function (Address Verification System) and require CVV codes to verify cardholder identity. If you offer online sales, consider third-party services like Kount or NoFraud to flag sketchy transactions before they happen.

3. Make Your Descriptor Crystal Clear
   

   Customers often don’t recognize charges on their bank statements. Be sure your business name and phone number appear on the Billing Descriptor. The Descriptor appears on your customer’s monthly credit card statement. Your credit card processor can update this for you.

4. Post a Clear Refund Policy
   

   Whether someone bought the wrong size helmet or wants to cancel a group ride, your refund policy should be easy to find and easy to understand. Offer flexible options and always follow up with customers directly before a dispute escalates.

5. Quality Counts
   

   No one wants a wobbly wheel or a sticky brake. Ensure the bicycles you sell or service meet the highest quality standards. A well-inspected product or repair job can reduce returns and chargebacks due to dissatisfaction.

6. Keep Your Contracts & Contact Info Transparent
   

   If you run a rental, subscription or membership-based service, make your terms and customer support info easy to find. Customers should know how to reach you if there’s an issue before they decide to go straight to their credit card company with a dispute.

7. Negotiate Before the Bank Gets Involved
   

   If a customer is unhappy, try to resolve the issue before it turns into a dispute. A phone call can be the fastest way to clear up confusion or offer a solution that works for both sides.

8. Track Deliveries and Get Proof
   

   Shipping out bicycles or parts? Always use a trackable method and get delivery confirmation. For in-store pickups or service jobs, get a signed work order or completion acknowledgment. Documentation is your best defense in winning a chargeback.

9. Use an EMV-Compliant POS System
   

   Still typing in credit card numbers by hand? That opens you up to fraud disputes and costs you more money for the transaction. Use chip-enabled (EMV) terminals and/or a cloud-based POS system to make transaction tracking and dispute resolution simple and secure.

10. Add Product Demos Online
    

    If you’re selling bicycles or gear online, post demo videos to show how products work and look. When customers understand what they’re getting, they’re less likely to say, “this wasn’t what I expected” and file a chargeback.

Avoiding chargebacks in the bicycle business takes some legwork, but it pays off. With the right mix of customer service, fraud prevention, and smart tech tools, you can keep your revenue rolling and your business reputation in top gear. Keep these tips in mind, and you’ll spend less time fighting chargebacks and more time doing what you love: Helping people ride!

For more information about disputing a chargeback, contact NBDA’s dedicated Relationship Manager: jim.luff@risewithaurora.com or call 661-706-7955