Do You Have The Right Staffing Plan For Managing Chargebacks?

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The process of disputing chargebacks isn’t easy. For each chargeback, the merchant needs to present specific documents to the card-issuing bank within the given period of time. The documentation that a merchant may need to dispute a chargeback can span across multiple departments, including billing, fraud monitoring, and fulfillment. Because of this, some merchants view as a cost of doing business.

The first step for determining whether you are properly staffed to fight chargebacks is to calculate how much money you may be losing as a result of chargebacks. If chargeback losses are material or affecting your profits, you’ll need to create a plan to fight them immediately. The more time that passes without contesting chargebacks, the more money your business could lose.

Creating a Staffing Plan

A major consideration for chargeback management is creating the right staffing plan. Who should handle your chargebacks? Should someone from accounting or customer service be responsible for filing documentation against these chargebacks? Qualified candidates should have problem-solving skills, solid writing abilities and familiarity with the payment and fraud review process. When staffing this position, also keep in mind that they will have access to sensitive company and customer information.

Additionally, due to short filing deadlines, it’s important that the process of fighting chargebacks is not delayed because of interdepartmental misalignments. Create a process that works across all departments and ensure your chargeback team can easily access or obtain the information they need. If you opt to employ a team, you can limit access to sensitive information to just the team lead or manager.

If you already have a staffing plan in place, reevaluate the plan to ensure it matches your needs. Furthermore, ensure your plan has addressed the following issues: staffing allocation for chargebacks, seasonality, and growth.  If you utilize external resources to manage the process, you will also need to ensure you evaluate any business need to expand or shrink the engagement when evaluating your staffing plan annually.

Determining Allocation for Chargebacks

Next, you should structure your staffing plan around your demand. Determine how much money your company would like to allocate to fighting chargebacks. Important factors to consider include the amount currently being lost to chargebacks, the number of chargebacks that are received and won each month, and the average time spent disputing each chargeback.

Although you’ll build a team dedicated to contesting chargebacks, a critical first step in the chargeback management process is prioritizing which cases to contest. Unfortunately, not all cases can be won, so it’s important to prioritize so you can allocate your resources to cases with a high chance of chargeback reversal. The easiest way to determine if there is a strong chance of winning a case is to evaluate if you have the required support and documentation.  If not, then you are less likely to win a chargeback reversal, and you should prioritize winnable chargebacks. Because of this, you should build in a budget to hire someone on your staff whose responsibility is determining which chargeback cases will be fought.

Factoring in Chargeback Seasonality

Having a clear overview of the number of chargebacks you receive monthly and the amount of time required to fight them will determine the number of employees you’ll need to accomplish your goal. Be sure to factor in the seasonality of your business. Consider hiring extra staff dedicated to fighting chargebacks during periods when your business receives an increased number of potentially fraudulent or customer-service based claims. Determining in advance whether you’ll hire additional employees helps ensure you are well-staffed during these spikes. Alternatively, you can offer overtime to existing employees. If you opt to hire additional staff, do not forget to include the time needed to train them. Forecasting both of these scenarios will be important in preparing and successfully executing protocols during increased chargeback activity, not to mention ensuring you do not lose chargebacks simply because you do not have your resources aligned.

Once you have an overview of the number of staff you need, match it against your budget. Don’t forget to include budget for a managerial role as well as seasonal employees. Working out the budget in advance will allow flexibility for last-minute changes in chargeback trends. For example, if newly implemented screening processes successfully decrease chargebacks, you can consider limiting the number of staff allocated to fighting chargebacks or forgo hiring seasonal help.

Staffing for Growth

As your company grows you want the demand for chargeback personnel to remain the same or grow at a slower pace. Determine the needs for the following year by analyzing previous year-over-year chargebacks. This helps to minimize unnecessary budget increases for your chargeback department.  Furthermore, due to the complexity of the chargeback process, it can become expensive to continually train new staff for the role. Retain staff by providing a clear job description before they sign on. If retention becomes an ongoing issue, consider offering a bonus structure tied to the number of chargebacks reversed.

Next, consider the growth of employees to determine how many members from the team will remain. For the staffing plan to be effective, use projections that accurately reflect the company. If possible, forecast next year’s staffing needs, incorporating employee retention rates from your company or better your department.

Leveraging External Resources

If ultimately you decide staffing employees to manage chargebacks is not the right business decision for your company at this time, it does not mean you cannot fight chargebacks. There are a number of external resources that can help.

Another option is to purchase a comprehensive SaaS solution, like the one Accertify provides, that includes a platform to help manage fraud, fight chargebacks and process payments.  This approach can be used to help drive efficiencies in your process or could be coupled with Accertify’s Managed Services.  They can help you simplify your fraud and chargeback operations by leveraging a team of highly trained analysts directly or as part of your in-house staff.