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Authvia Helps Appliance Factory Reduce Fraud and Increase Speed-to-Payment

October 13, 2022

Posted by Authvia Team | 3 Minute Read

Appliance Factory | Products

Key results:

→ 73% of payments completed in <15 minutes
→ 6.2 minutes average time-to-payment
→ 10.5+ hours saved each week

About Appliance Factory

The nation’s largest, independent discount appliance and mattress retailer, Appliance Factory has grown into 26 locations in Colorado, Ohio, Indiana, and Kentucky. Founded in 1986, Appliance Factory specializes in special orders, discounted sleep products, and exclusive contracts with manufacturers to purchase overstock, minor case imperfections, and uncrated products to deliver appliances at 30 – 60% off to customers.

A customer since May of 2022, Appliance Factory uses Authvia to streamline the payment process for customers that make payments over the phone, call to add on to an existing order, or pay in person when they pick up an order. After expanding quickly to 26 locations and recognizing a problem with fraud, chargebacks, and other accounting issues, they realized they could solve these problems with a better payment process. With TXT2PAY® from Authvia, their problems were solved. Fraud cases dramatically decreased and customer satisfaction increased. The text-to-pay process was easy to implement for the sales team and they saved a single corporate employee more than 2 hours of manual auditing work every day.

The Challenge

Before Authvia, Appliance Factory struggled with several payment problems. Jason Gilbert, Manager of the Online Sales Division, explained, “One of the biggest issues with the appliance industry and other industries with high-ticket, high-dollar value pieces is that we’re susceptible to fraud.”  The team was seeing these issues with customer pick-up transactions and sometimes during card not present transactions. “We discovered a hole in our standard operating procedure on how to protect ourselves and capture the right customer information.” 

With in-person transactions, card readers were helpful at checkout lines, but over-the-phone transactions created issues for compliance. “We had a form for the retail staff to fill out, but then it had to go up to the corporate office for approval,” said Jason. A single member of the corporate team was responsible to approve each transaction, which created a bottleneck.

“As much as that sounds like a small part of the business, it’s actually a whole lot of our business, especially in our post COVID world,”  said Jason.

All 26 locations funneled their approval requests through a single auditor. Each transaction could take up to 5 minutes and that single employee was managing 25 transactions per day, on average. It was a large operational burden and a misalignment of company resources. “She’s the one who would handle those approvals. It would take a significant chunk out of her day,” said Jason.

The Authvia Solution

After a few growing pains of opening new stores quickly and managing a bit of turnover, Appliance Factory took a deep dive into their accounting practices. “When we really dove into the open chargebacks or arbitration cases, we realized that a lot of them were easily preventable at the time of transaction if we just had a better process.”

The team heard about Authvia through their credit card processor, Elavon. And while the team didn’t know if TXT2PAY® was the answer they needed, they wanted to learn about it. Jason explained, “When it comes down to it, preventing fraud is a big win for the company. With how many processes we have and how complicated our company is, we needed an easy payment process. We needed it to be as easy as possible for the salesperson and the end customer.”

Initially, the plan was to roll out Authvia’s cornerstone solution, TXT2PAY® to just the online sales department, but the team quickly decided to roll it out to the entire company. “We realized it was what we needed and we expanded it quickly to the rest of the organization.”

The team brought Authvia on to help with the customer pickup transactions. Unique situations, such as a landlord calling and paying for an appliance that a tenant will pick up or receive, create challenges for customer name matching and payment information problems. “Authvia helped us organize and keep everything aligned. We know who’s who and who is coming to pick up the appliance. We know who paid for the appliance. Authvia just helps us paint the picture and because of that, it helps with our fraud problem.”

Currently, the team uses the convenience fee option. When customers pay with TXT2PAY®, they pay an additional $3 convenience fee. “And that convenience fee has paid for Authvia entirely, plus some. It’s really paying for itself.”

But Authvia is doing more than just creating an easier way to collect payments from pick-up customers, it’s cutting down on the fraud problem that the team set out to solve. “Authvia is helping us with the chargebacks and disputes. Our fraud numbers have gone down significantly.

Situations for text-to-pay are present in most transactions for Appliance Factory. In fact, all phone-in orders are paid with TXT2PAY®, making up 7 out of every 50 transactions for the business.

Now, when customers call in to place an order, or even to add on to a previous order, the payment process is easy, meets compliance standards, and reduces opportunities for fraud. “It’s great because customers don’t have to come back to the store to make a payment. I can just shoot them a text and we take care of the balance. It’s quick and easy.

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