What is a good e-commerce return rate?

A good return rate varies by category: Electronics and home goods typically see 5-10% returns, while apparel and fashion can see 20-30%. Overall e-commerce averages around 15-20%. Return rates under 10% are considered excellent for most categories.

How do you calculate return rate?

Return Rate = (Number of Returned Orders / Total Orders) × 100. For example, if you had 1,000 orders and 150 were returned, your return rate is 15%. You can also calculate return rate by value: (Value of Returns / Total Revenue) × 100.

What is the true cost of returns?

The true cost of returns includes: the refund amount, return shipping costs, processing/restocking labor, potential product damage or unsellable inventory, and lost customer lifetime value. Studies show the average return costs retailers $10-15 in processing alone, plus the refunded amount.

Why is my return rate high?

Common causes of high return rates include: inaccurate product descriptions or photos, sizing issues (especially apparel), quality not matching expectations, damaged items during shipping, buyer's remorse, and wardrobing/bracketing (buying multiple sizes to try). Analyzing return reasons helps identify root causes.

How can I reduce my return rate?

Strategies to reduce returns: Improve product descriptions and photos, add sizing guides and fit technology, show customer reviews prominently, ensure quality control, use better packaging, offer virtual try-on tools, and implement stricter return windows for serial returners.

What is the difference between return rate and exchange rate?

Return rate measures orders returned for a refund, while exchange rate measures orders exchanged for a different size/color/item. Exchanges retain the sale and customer. Many successful retailers focus on converting returns into exchanges to preserve revenue.

E-commerce Return Rate Calculator

Calculate your e-commerce return rate and understand the true cost of returns. Get benchmarks and AI-powered strategies to reduce returns.

Enter Your Values

Total Orders*

orders

Total number of orders placed in the period

Returned Orders*

returns

Number of orders that were returned

Total Revenue

Total revenue from all orders in the period

Value of Returns

Total dollar value of returned orders

Processing Cost Per Return

Average cost to process each return (shipping, restocking, labor)

Formula

Return Rate = (Returned Orders / Total Orders) × 100

The return rate measures what percentage of orders are returned. Lower return rates indicate better product descriptions, quality, sizing accuracy, and customer satisfaction.

Return Rate8.0%

8.0% return rate — Good. Below average for most e-commerce categories.

Keep Rate92.0%

Orders Kept920 orders

Return Value Rate12.0%

Net Revenue (after returns)$88,000

Total Processing Cost$1,200

True Cost of Returns$13,200

Avg Cost Per Return$165

Performance RatingGood

Savings if -5% Return Rate$8,250

How Does Your Return Rate Compare?

Excellent0-5% — Top performers, strong product-market fit

< 5%

Good5-10% — Below average, typical for electronics/home goods

5.01% – 10%

Average10-20% — Industry average for general e-commerce

10.01% – 20%

High20-30% — Common for apparel/fashion

20.01% – 30%

Very High30%+ — Investigate sizing, quality, descriptions

> 30.01%

Source: National Retail Federation, Shopify Benchmark Data 2024

How to Calculate E-commerce Return Rate

Enter your total number of orders for the period
Enter the number of orders that were returned
Optionally add total revenue and value of returns for detailed analysis
Add your average processing cost per return
View your return rate, keep rate, and true cost of returns
Compare against industry benchmarks by category
Chat with our AI Ecommerce Analyst for strategies to reduce returns

E-commerce Return Rate Benchmarks by Category

15-20%

Overall E-commerce Average

25-30%

Apparel & Fashion

20-25%

Footwear

8-10%

Electronics

10-15%

Home & Garden

5-7%

Health & Beauty