Returns Cost Calculator, True Retail Cost
Quantify the true cost of your returns program: processing, restocking, damaged goods, and the wholesale allowances it creates. Returns cost more than they appear on the P&L.
How the calculation works
- Return volume: orders split into DTC and B2B by your B2B share; each side's return rate gives returns per month.
- Cost per DTC return: return shipping, processing labor and repackaging, plus COGS times the damaged share, plus unit price times the fraud rate.
- Wholesale chargebacks: each wholesale return or allowance is credited at the average unit price.
- Impact: total monthly cost divided by gross revenue (orders times average unit price), and per order shipped.
In the default example, the prepaid return label ($8.50) is half of the $16.82 cost per return. Check which line dominates in your own numbers before deciding where to cut.
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