Return rate

What the return rate means

The return rate is the share of orders or line items that are sent back. It is usually calculated per line item, because an order with five articles and one return says something different than an order with one. The rate varies strongly by industry: fashion sits far higher than groceries or furniture.

The term is often confused with the share of goods returned. Either is possible; what matters is that the definition stays the same over time, otherwise two periods cannot be compared.

What a return costs

A return costs more than the return shipment. It ties up staff for receiving, checking and restocking. It occupies shelf space with goods that have not been sold again. It consumes packaging and can lead to write downs when the item can no longer be sold as new. Counted in advertising cost, an order that came back is a fully paid visit without revenue.

Which causes sit inside the shop

• Unclear size information: anyone who does not show dimensions, fit and material precisely sells on guesswork.
• Flattering photos: colour and finish have to match the original, not the wishful image.
• The shipping cost trap: free returns lower the hurdle to buy but raise the number of attempts.
• Delivery time missed: when goods arrive later than announced they are more often no longer needed.
• Assortment breadth: anyone ordering a lot in order to choose sends more back. That is not a mistake but a consequence of the offer.

What actually helps

The most effective measures sit before the purchase. Precise measurements with a note on fit, meaningful photos in honest light and customer reviews stating size information lower the rate more reliably than any rule in the returns process. Quality assurance comes next: recurring return reasons should be evaluated and fed back to buying, because they turn into assortment decisions.

Only at the end is the return handling itself worth attention. A simple returns portal with a printable label saves staff but does not lower the number of returns.

Frequent questions

• Which rate is normal? It depends on the industry. Fashion often sits between 20 and 50 percent, other assortments well below.
• Should returns be free? It raises the likelihood of purchase and the number of returns. The decision rests on the margin.
• Can I restrict returns? Only within the limits of consumer law. Blanket exclusions are not permitted.