Latest news with #RetailEconomics
Yahoo
2 days ago
- Business
- Yahoo
Payment Outages Threaten £1.6 Billion in UK Retail & Hospitality Sales
Research also shows UK Businesses Average Over 5 Major Outages Annually, with 61% Occurring During Critical Peak Trading Times London, UK, June 10, 2025 (GLOBE NEWSWIRE) -- A new study released today reveals the staggering cost of payment system failures to UK retail and hospitality businesses, estimating losses of £1.6 billion annually. The research, conducted by FreedomPay and Dynatrace in partnership with Retail Economics, highlights the increasing frequency and impact of these disruptions on day-to-day trading, with consumers exhibiting low tolerance for delays. Adding to the concern, the study finds that 1 in 5 retail and hospitality businesses lack a secure digital backup when systems fail, exacerbating the potential for lost revenue. The study indicates that these failures are not isolated incidents but a recurring operational challenge that disrupts service, damages customer trust, and negatively impacts revenue. UK businesses are reporting an average of over five major outages each year, with 61% occurring during peak trading periods, amplifying the financial impact. "Consumer-facing businesses are operating in increasingly unpredictable conditions," says Chris Kronenthal, President, FreedomPay. "From extreme weather and power failures to cyber-attacks and system outages, disruption is no longer the exception, it's becoming the norm. The lack of planning by businesses, coupled with the fragility of existing infrastructure, is creating a perfect storm for revenue loss and reputational damage." Key findings from the study include: Consumer tolerance: Most consumers will only tolerate up to 6 minutes of payment disruption before becoming frustrated, with 22 minutes being the absolute limit. The average outage, however, lasts 84 minutes – far exceeding consumer patience. Costly blind spots: Businesses are dangerously out of touch with consumer patience, overestimating their willingness to wait during payment disruptions (32 minutes vs. the actual 22 minutes) and failing to recognise the immediate customer attrition this misjudgement causes, leading to significant revenue loss and damaged brand reputation. Payment system downtime is costly: If a payment system goes down between minutes 7 and 11, businesses could lose an average of £73 million in sales every minute. Losses quickly add up: By minute 22 of the outage, total losses could reach £1.17 billion. That's a whopping 74% of all the revenue at risk. Reliance on mobile and card payments continues to rise: Less than 30% of consumers always carry cash when visiting shops, restaurants, or leisure venues. The average amount carried is £35, which is less than the average in-store spend of £47. Vulnerable consumers: Higher-income consumers, who tend to visit physical retail and hospitality venues more frequently and rely more heavily on digital payments, are disproportionately affected by payment disruptions. Backup gaps: 22% of businesses study having no backup payment method beyond cash, and 7% have no fallback at all. "Payment resilience isn't just an IT issue, it's a critical business capability', adds Alois Reitbauer, Chief Technology Strategist, Dynatrace. 'Outages don't just stop transactions; they break the customer journey and disrupt essential services. To stay resilient, businesses need real-time visibility, the agility to adapt in real time, and technologies that auto prevent and auto remediate disruptions. In a world where disruptions are inevitable, speed and insights are a business's most valuable safeguards." "In today's hyper-competitive landscape, seamless payment experiences are non-negotiable,' states Richard Lim, CEO, Retail Economics. 'Our research underscores the critical need for retailers and hospitality businesses to prioritise payment resilience. The financial impact of outages is significant, but the erosion of customer trust and brand loyalty can cause long term damage. Investing in robust, fail-safe payment infrastructure isn't just about mitigating risk; it's about safeguarding future growth and maintaining a competitive edge." The full study can be found here. About FreedomPay FreedomPay's Next Level Commerce™ platform transforms existing payment systems and processes from legacy to leading edge and enables merchants to unleash the power of pay. As the premier choice for many of the largest companies across the globe in retail, hospitality, lodging, gaming, sports and entertainment, foodservice, education, healthcare and financial services, FreedomPay's technology has been purposely built to deliver rock solid performance in the highly complex environment of global commerce. The company maintains a world-class security environment and was first to earn the coveted validation by the PCI Security Standards Council against Point-to-Point Encryption (P2PE/EMV) standard in North America. FreedomPay's robust solutions across payments, security, identity, and data analytics are available in-store, online and on-mobile and are supported by rapid API adoption. The award winning FreedomPay Commerce Platform operates on a single, unified technology stack across multiple continents allowing enterprises to deliver an innovative Next Level experience on a global scale. About Dynatrace Dynatrace is advancing observability for today's digital businesses, helping to transform the complexity of modern digital ecosystems into powerful business assets. By leveraging AI-powered insights, Dynatrace enables organizations to analyze, automate, and innovate faster to drive their business forward. Learn more at About Retail Economics Retail Economics is an independent economics research consultancy focused on B2B thought leadership in the consumer and retail industry. We analyse the complex retail economic landscape and draw out actionable insight for our clients. Leveraging our own proprietary retail data and applying rigorous economic analysis, we transform information into points of action. Our service provides unbiased research and analysis on the key economic and social drivers behind the retail sector, helping to inform critical business decisions, giving you a competitive edge through deeper insights. Contact: Freedompay: freedompayuk@ Dynatrace: dynatraceuk@ CONTACT: Jennifer Tayebi Burson for FreedomPay +1 734 395 0780
Fashion United
16-05-2025
- Business
- Fashion United
Returns fraud is costing UK retailers 1.3 billion pounds a year: Here's how to fight back in 2025
Returns fraud isn't new. But for UK retailers in 2025, it has reached a level of urgency that can no longer be ignored. In a recent Loop survey, nearly two-thirds (64 percent) of UK-based brands said rising returns fraud was the trend having the biggest financial impact on their business. From wardrobing (wearing and returning) to serial bracketing and exploiting lenient refund policies, brands are being hit from all angles. Written by John-David Klausner, GM International, Loop The data confirms it's not just perception. According to Retail Economics, UK retailers are now losing 1.3 billion pounds annually to returns fraud. The British Retail Consortium has also flagged fraudulent returns as a key concern for its members, particularly in apparel and footwear, where abuse rates can reach up to 15 percent of total returns. Add to that a tough economic climate and ever-higher consumer expectations, and you have a perfect storm. But while UK law strongly protects consumer rights, retailers still have meaningful tools at their disposal to reduce abuse—without alienating honest customers or running afoul of regulations. Here's how leading brands are responding. 1. Work within the law. Don't get steamrolled by it The UK has some of the most consumer-friendly legislation in the world. Under the Consumer Contracts Regulations 2013, customers can cancel most online purchases within 14 days of receipt and have another 14 days to return them—giving them a minimum 28-day no-questions-asked return window. That law exists for good reason. But some customers exploit it to 'try before they buy,' wear items and return them, or bracket multiple sizes and styles with no intention of keeping most. Legally, retailers can't refuse those returns outright. But you can inspect returned goods and deduct value from refunds if items show signs of wear or misuse. The key is having clearly defined policies and fair, consistent enforcement, especially when the refund is partial. 2. Scrutinise post-window returns with structure and fairness The Consumer Rights Act 2015 gives consumers a 30-day window to reject faulty goods for a full refund. After that, they're entitled to a repair or replacement within six months—and in some cases, up to six years. Many brands are seeing a rise in fraudulent fault claims, especially after the initial return window has closed. To counter this, retailers are tightening how they assess claims: Requiring video evidence of damage or defect Using serial number verification to confirm authenticity Asking customers to return the item before processing a refund This approach prevents opportunistic abuse while still supporting genuine claims—helping teams make better decisions, faster. 3. Leverage AI to detect risky behaviour - ethically and compliantly Machine learning has transformed returns fraud detection. Platforms like Loop can flag suspicious behaviours, such as unusually high-value return volumes, repeated abuse of refund policies, or inconsistent return reasons. This allows retailers to automatically route those transactions for manual review, enabling them to take action before losses mount. However, merchants must be careful with how they use customer data. Under the UK GDPR and Data Protection Act 2018, brands are legally required to: Be transparent about what data they collect and why Provide customers with access to their data Offer a clear appeals process if returns are denied based on fraud detection Used correctly, AI is a valuable fraud deterrent. But customers must retain control over how their data is used and have the right to challenge decisions when appropriate. 4. Build tiered policies that respond to different risk levels A common pitfall is treating all returns equally. In 2025, more retailers are applying tiered controls based on the risk profile of the transaction or customer. Examples include: Requiring manual approval for returns over a certain value Offering instant refunds only to customers with low return rates Limiting the number of returns allowed per customer per year Setting stricter policies for high-return-rate items, like seasonal fashion or luxury goods This segmentation allows retailers to preserve a great experience for the majority of customers while managing the small minority responsible for most abuse. 5. Invest in proactive insight, not reactive fixes Returns fraud isn't static. The methods used by abusive customers shift constantly and so must your defenses. Retailers with best-in-class operations regularly analyse return data to identify emerging abuse patterns. For example, some Loop clients have discovered that certain SKUs or geographic regions are disproportionately linked to high rates of wardrobing, prompting targeted policy updates or inspection processes. The goal is to move from reacting to fraud after it happens, to designing policies that anticipate and prevent it. That mindset shift, towards continuous improvement, is what separates brands that merely cope from those that lead. A new era of returns management Returns used to be seen as a cost of doing business. In 2025, they're increasingly a source of competitive differentiation. Brands that strike the right balance between generosity and accountability will not only protect their margins but also earn trust from customers who value fairness and transparency. It's true that the UK's consumer laws favour the buyer. But that doesn't mean retailers are powerless. On the contrary, by implementing smarter technology, setting thoughtful policies, and investing in continuous returns optimisation, brands can regain control. Fraud may be rising… but so is the capability to fight back, ethically and effectively. About the guest contributor Loop is the industry's leading commerce operations platform that empowers Shopify brands to streamline their entire customer journey, reduce friction, and maximize revenue. Its end-to-end approach integrates capabilities that help brands simplify their operations and delight customers, from initial orders to returns and exchanges. Offering features like Workflows, Instant Exchanges, Offset, and AI-powered tracking and visibility, Loop reduces costs, increases customer lifetime value, and retains revenue for more than 5,000 of the world's most-loved Shopify brands. Loop has processed over 55 million returns and counting, and has helped merchants retain more than $2 billion in revenue over the past five years while delivering exceptional customer experiences.
Scotsman
08-05-2025
- Business
- Scotsman
New tool allows UK online shoppers to try on clothes before they buy
Online fashionistas can now try before they buy! | Makip An online sizing technology provider has announced today (May 8) that UK shoppers will be presented with a personalised 3D avatar to see how their next fashion item will fit them. Sign up to our daily newsletter – Regular news stories and round-ups from around Scotland direct to your inbox Sign up Thank you for signing up! Did you know with a Digital Subscription to The Scotsman, you can get unlimited access to the website including our premium content, as well as benefiting from fewer ads, loyalty rewards and much more. Learn More Sorry, there seem to be some issues. Please try again later. Submitting... Makip, an online Japanese sizing tech specialist, has upgraded its flagship product, Unisize, which allows consumers to check their 3D avatar from four angles - front, back, left, and right - to see how a clothing item will fit their body shape before buying. It comes as research from independent economics research consultancy, Retail Economics, showed that in 2024, 17 out of every 100 products sold online were returned. The fashion industry saw return rates reach as high as 30 per cent due to issues such as incorrect sizing, and the cost of returns continues to be an unwelcome line item on the balance sheet of many online retailers. Especially as many online shoppers seem perfectly happy to order multiple sizes, colours, or styles of an item to return most of the order after trying them on at home Shingo Tsukamoto, CEO and President of Makip, said: 'The average return rate for the UK fashion industry is 26%. 'One in every four items purchased online is returned, usually at the expense of the retailer. 'We feel that this cannot continue. 'In recent years, some retailers have taken a stand and started charging customers for returning items, however, we approach this from the view of customer experience. 'If we can provide customers with more accurate sizing options at the time of purchase, this leads to a reduction in returns. 'This has been proven across our Japan-based fashion clients with the average return rate dropping by 20%.' The announcement comes following increasing online returns for clothes | Shutterstock How does the 3D avatar work? The 3D model is generated based on the dimensions of the clothing and the user's body shape information, and allows consumers to check the looseness and fit of the clothing item before making a purchase. The model can be viewed from 360 degrees, so all angles are covered, and because of the 3D element, users can now view the silhouette while wearing shoes (which can be changed from sneakers to heels) and how the hemline of pants falls when wearing different footwear. Tsukamoto added: 'In recent years, platforms like TikTok and YouTube have normalised individually tailored content, influencing all generations. 'Similarly, personalisation in apparel e-commerce is expected to become an essential element of the online fashion industry. 'We will continue to expand our services with a focus on personalisation. 'We already have the FaceChange feature within Unisize, which allows users to upload an image of their face onto the model used for the fashion item, and our personalisation database allows returning users to compare previously purchased items with new items to see how the fit matches or differs.' Makip is the number one online sizing recommendation provider in its home country of Japan. This latest upgrade to its Unisize product is part of its global expansion strategy to strengthen its presence in overseas markets.
Fashion Network
08-05-2025
- Business
- Fashion Network
Makip upgrades Unisize tech in UK
It comes as retailers and brands continue to work towards reducing online returns with size and fit issues one of the main reasons for an outsized number of returns by e-shoppers compared to in-person shoppers. Research from Retail Economics showed that last year, while 17 out of every 100 products sold online across all categories were returned, the fashion industry saw return rates reach as high as 30% due to issues such as incorrect sizing. On average a quarter of clothing items are returned. The problem for retailers isn't just that consumers are returning items due to them not fitting as they expected but that those shoppers are now regularly ordering multiple sizes, colours, or styles of an item and would only ever keep one. Understandably, this is a major logistics problem and contributes to a huge number of returned items being marked down each season. Unisize 3D works by generating a 3D avatar based on the dimensions of the clothing and the user's body shape information. The avatar allows users to check the looseness and fit of the clothing item before making a purchase. The 3D model can be rotated to provide a 360-degree view of the silhouette so they can see, for instance, how the item fits across the chest or arms when viewed from the side or how it hangs from the hips down to the ankles. For trousers there's also a key enhancement. With 2D online sizing, user images were displayed barefoot, but with the new 3D function, users can now view the silhouette while wearing shoes and the model's footwear can be changed from trainers, shoes or heels. That said, this particular function is currently available for select avatars only. Shingo Tsukamoto, CEO and President of Makip, said that with an enormous number of fashion items being returned 'usually at the expense of the retailer, we feel that this cannot continue. In recent years, some retailers have taken a stand and started charging customers for returning items, however, we approach this from the view of customer experience. If we can provide customers with more accurate sizing options at the time of purchase, this leads to a reduction in returns. This has been proven across our Japan-based fashion clients with the average return rate dropping by 20%'. He added that 'in recent years, platforms like TikTok and YouTube have normalised individually tailored content, influencing all generations. Similarly, personalisation in apparel e-commerce is expected to become an essential element of the online fashion industry. We already have the FaceChange feature within Unisize, which allows users to upload an image of their face onto the model used for the fashion item, and our personalisation database allows returning users to compare previously purchased items with new items to see how the fit matches or differs.' The new development comes after Makip this year set up a UK-based company, Makip London Limited, 'marking an important step in accelerating its global expansion and strategy to strengthen its presence in overseas markets'.
Fashion Network
08-05-2025
- Business
- Fashion Network
Makip upgrades Unisize tech in UK
It comes as retailers and brands continue to work towards reducing online returns with size and fit issues one of the main reasons for an outsized number of returns by e-shoppers compared to in-person shoppers. Research from Retail Economics showed that last year, while 17 out of every 100 products sold online across all categories were returned, the fashion industry saw return rates reach as high as 30% due to issues such as incorrect sizing. On average a quarter of clothing items are returned. The problem for retailers isn't just that consumers are returning items due to them not fitting as they expected but that those shoppers are now regularly ordering multiple sizes, colours, or styles of an item and would only ever keep one. Understandably, this is a major logistics problem and contributes to a huge number of returned items being marked down each season. Unisize 3D works by generating a 3D avatar based on the dimensions of the clothing and the user's body shape information. The avatar allows users to check the looseness and fit of the clothing item before making a purchase. The 3D model can be rotated to provide a 360-degree view of the silhouette so they can see, for instance, how the item fits across the chest or arms when viewed from the side or how it hangs from the hips down to the ankles. For trousers there's also a key enhancement. With 2D online sizing, user images were displayed barefoot, but with the new 3D function, users can now view the silhouette while wearing shoes and the model's footwear can be changed from trainers, shoes or heels. That said, this particular function is currently available for select avatars only. Shingo Tsukamoto, CEO and President of Makip, said that with an enormous number of fashion items being returned 'usually at the expense of the retailer, we feel that this cannot continue. In recent years, some retailers have taken a stand and started charging customers for returning items, however, we approach this from the view of customer experience. If we can provide customers with more accurate sizing options at the time of purchase, this leads to a reduction in returns. This has been proven across our Japan-based fashion clients with the average return rate dropping by 20%'. He added that 'in recent years, platforms like TikTok and YouTube have normalised individually tailored content, influencing all generations. Similarly, personalisation in apparel e-commerce is expected to become an essential element of the online fashion industry. We already have the FaceChange feature within Unisize, which allows users to upload an image of their face onto the model used for the fashion item, and our personalisation database allows returning users to compare previously purchased items with new items to see how the fit matches or differs.' The new development comes after Makip this year set up a UK-based company, Makip London Limited, 'marking an important step in accelerating its global expansion and strategy to strengthen its presence in overseas markets'.
