Return rate calculator
See what returns really cost: shipping back, refund fees and restocking loss are deducted item by item to give the actual net margin, the profit lost, the break-even return rate and the return rate your target margin allows.
Runs in your browserEvery computation happens in your browser — your data never leaves this device.
Orders and returns
Money is computed in integer cents and the total return cost is split across the returned orders with the largest remainder method; ratios are shown rounded to 2 decimals.
Return cost analysis
12.00%80.00-28.0067,040.0080,000.0012,960.0033.52%6.48 pp74.07%18.52%3,360.0028.00What this tool does
- See what returns actually eat: 1,000 orders with 120 returns at a 200 yuan average order and a 40% margin cost 3,360 yuan in return costs, which is 12,960 yuan of lost profit and drops the net margin from 40% to 33.52%.
- Judge how much more returns you can absorb: the break-even return rate for this structure is 74.07%, so anything above it turns the business unprofitable — a useful number to compare with your category average.
- Set a return-rate target: holding a 30% net margin only allows an 18.52% return rate, so the current 12% leaves little headroom and the size chart or product page needs work.
- Model a policy like free returns: change the return shipping from 12 yuan to 0 or 30 and watch both the lost profit and the affordable return rate move before you commit to it.
Example
Input
1,000 orders, 120 returned, 200 yuan average order, 40% gross margin, 12 yuan return shipping, 2% refund fee, 10% restocking loss, 100% refund, 30% target net margin
Output
Return rate 12.00%, profit per kept order 80.00 yuan, profit per returned order -28.00 yuan, total return cost 3,360.00 yuan, actual total profit 67,040.00 yuan, no-return baseline 80,000.00 yuan, profit lost 12,960.00 yuan, actual net margin 33.52% (down 6.48 points), break-even return rate 74.07%, return rate allowed by the target margin 18.52%
Profit per returned order = 0 kept revenue − 12.00 restocking loss − 12.00 return shipping − 4.00 refund fee = -28.00 yuan; the item goes back on the shelf, so only 10% of its cost is lost rather than all of it.
Frequently asked questions
How is the break-even return rate calculated?
It is profit per kept order ÷ (profit per kept order − profit per returned order): here 80 ÷ (80 + 28) = 74.07%. Above that return rate the losses from returns wipe out the margin earned on the orders that stay, and the whole operation goes negative. If a return is not actually worse than a kept order, the tool shows “—”.
Why does a return only lose 10% of the product cost?
Returned goods usually go back on the shelf, so most of the product cost is recovered; the restocking loss rate is the part you cannot recover (damaged packaging, markdowns, cleaning). If an item is effectively unsellable, set the loss rate to 100% and the whole cost becomes a loss.
Why is the actual net margin measured against the original order value?
The denominator is orders × average order value — the revenue you would have had with no returns — so the actual net margin can be compared directly with the 40% gross margin and you can see exactly how many points returns cost you. Using post-refund revenue instead would make the two numbers incomparable.
How are amounts and percentages rounded?
Money stays in integer cents and the refund amount, restocking loss and refund fee are each rounded once. The total return cost is split across returned orders with the largest remainder method, so the parts always sum to the total. Ratios keep their exact value internally and are rounded to 2 decimals for display — the break-even rate is solved from the unrounded values.
How do I handle partial refunds?
Set the refund share to the real percentage, for example 50% for a half refund. The returned order then keeps half the revenue and the refund fee is charged on the amount actually refunded, which improves the profit per returned order and raises the break-even return rate.
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