Contract Keepers defines merchandise as any type of sellable goods involved in a transaction between a buyer and seller. Merchandise includes art, jewelry, watches, antiques, clothing, furniture, and other collectables.

Examples of marketplaces are:

Online marketplaces to sell products – eBay, Amazon marketplace, Etsy

Social media marketplaces – FB Marketplace, Instagram, StockX

Item specific marketplaces – watches.com, autotrader.com, boats.com

The primary concern with marketplaces is the fraudulent activity occurring through or alongside them.

Buyers NEED TO KNOW:

Buyers may be subject to financial fraud when illegitimate sellers falsify payment information, identities, and create fake websites to match legitimate businesses. These threats against financial loss can be mitigated by verifying counterparties payment and personal information before sending any funds.

Some marketplaces help buyers and sellers connect and perform merchandise transactions, but also encourages the use of payment methods outside of their platform. These types of payment scams target vulnerable and inexperienced buyers, and result in sending payments without protection or recovery methods. Sending funds to a middleman or escrow provider, allows a buyer to guarantee the merchandise transaction has been completed to their satisfaction before a seller receives the funds.

Buyers may need to perform damage inspections and appraisals to guarantee the item is as described. Sellers may deny damage or illegitimacy claims, however fraudulent behavior can be mitigated by signing a contract and recording specific documentation of the merchandise transactions from start to finish.

Sellers NEED TO KNOW:

The most pressing concern for sellers is guaranteeing payments are legitimate. Fraudulent buyers can send falsified statements from banks, businesses, and other third parties between a buyer and seller. Sellers should always check their account and make sure payments are confirmed whether through a banking service, marketplace, or payment service. Falsified receipts from emails that appear legitimate are a common way sellers send merchandise without receiving any payment.

Another concern is chargeback scams and false damage claims. These occur when a buyer sends a payment legitimately but will eventually file a fraudulent claim with the service the payment has been made through. These claims are often easy for buyers to file and in some cases immediately refund transactions, while demonstrating this is a false claim on the seller’s side takes much more time and effort.

A service which confirms quality satisfaction before releasing payments and treats both sides of the transaction equally, prevents chargeback scams. In addition, creating a legal agreement with a buyer beforehand helps deter this type of fraudulent activity by describing in detail the consequences of fraudulent chargeback or false damage claims. Specific documentation requires both sides to be transparent during transactions with an unknown buyer.

When selling expensive merchandise, buyers are often referred or connected through a marketplace. There is a lack of flexibility through these conventional methods that does not allow for both parties to transact on their own terms. A secure payment plan that ensures a buyer does not run off before finishing payments, as well as transparency to the terms of the deal allow for more seamless transacting for sellers who wish to sell their merchandise to an unknown buyer.