How much are returns really costing your store?
The refund is only part of what a return costs you. Add up the rest and returns often become one of the biggest hidden leaks on a Shopify store.
The hidden costs of a return
- Return shipping — often on you, especially with free returns.
- Handling and restocking — the labour to process and re-shelve.
- Unsellable stock — items that come back damaged or used are a full write-off of the product cost.
- Lost margin — the profit you booked on the sale reverses.
What is a normal return rate?
It varies widely by category — apparel can see 20% or more, while many other niches sit in the low single digits. The rate matters less than the cost per return and how many items come back unsellable.
How to measure it
Multiply your monthly orders by your return rate, then by the cost per return. The return cost calculator does the full monthly and annual math for you.
How to reduce it
Better sizing guides, accurate photos and descriptions, and identifying the specific products driving returns all help. Start by finding which products return most — that is usually where the money goes.
Catch refund spikes early
Profixo watches your return and refund rates and alerts you when a product's returns start draining its profit. Start a free 14-day trial.