Unit Economics Calculator ↗
Estimate contribution per order after product, fulfilment and acquisition costs.
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Free D2C calculator
RTO Cost Calculator
Estimate the direct costs of Return-to-Origin. Model COD versus prepaid, compare costs, and simulate possible savings.
Free to use · No signup · Calculations run in your browser · Choose any currency
Works for any market. Enter your own costs and rates.
01
Your numbers
Adjust to match your store’s operational data.
Prepaid orders45%Calculated automatically
RTO cost breakdown
Direct costs from 302 returned orders.
- Forward shipping wasted
- $19,630
- Reverse logistics cost
- $36,240
- Packaging wasted
- $7,550
- Total monthly RTO cost
- $63,420
Savings simulator
What if COD RTO dropped?
RTO cost saved$23,100per month
Orders recovered110orders/month
Revenue recovered$132,000per month
Scenario estimate based on your inputs. It does not connect to your store or replace actual settlement and cost reports.
How to use this calculator
Enter monthly orders, average order value, COD share and separate COD and prepaid RTO rates. Add forward freight, reverse freight and packaging per returned order. Change the target COD RTO rate to compare scenarios.
Worked example
For 1,000 orders, 60% COD and a 20% COD RTO rate, 120 COD orders return. If the 400 prepaid orders have a 5% RTO rate, another 20 return. At ₹80 forward freight, ₹80 reverse freight and ₹20 packaging, 140 returns cost ₹25,200 in direct logistics and packaging.
What the estimate leaves out
Revenue at risk is separate from direct cost. A lower target RTO rate is an assumption, not a forecast. The estimate excludes damaged stock, support time and inventory delays.
Use inputs from the same reporting period and compare the result with your actual costs before making a decision.
Explore order operations services ↗Read the complete RTO cost guide ↗
What does return-to-origin cost your store?
- COD share
- The percentage of placed orders paid by cash on delivery. Enter a percentage, not the number of COD orders.
- RTO rate
- Returned orders as a percentage of the relevant COD or prepaid orders. Use a consistent reporting period and allow delivery outcomes to settle.
- Direct RTO cost
- Forward freight, reverse freight and packaging for returned orders. Sales value at risk is displayed separately and is not net profit.
Why it matters
Understand the Cost of Undelivered Orders
Every returned COD shipment can lose forward freight, add reverse logistics, and waste packaging without producing revenue.
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Quantify the damage
Bring every direct RTO cost into one view instead of looking only at the reverse shipping bill.
- 02
Shift COD to prepaid
Use measured incentives and trust signals to move suitable customers toward prepaid orders.
- 03
Predict before dispatch
Confirmation and risk checks can flag suspicious or low-intent orders before fulfilment.
Frequently asked
Straight answers.
What is RTO in e-commerce?
Return-to-Origin means a shipment could not be delivered and was sent back to the seller.
Why is COD RTO so high in India?
Common causes include low purchase commitment, unreachable customers, address issues, delivery delays, and limited intent verification.
How does RTO affect profitability?
It removes expected revenue while adding forward, reverse, packaging, handling, and inventory-delay costs.
How can I reduce RTO rates?
Improve address and intent verification, communicate delivery clearly, incentivise prepaid payment, and review patterns by pincode, product, and campaign.
Check the next part of the picture.
Inventory Reorder Point Calculator ↗
Set a reorder point from daily sales, supplier lead time, and a safety buffer.
Calculation method and examples maintained by MlabsGrowth. See the assumptions above before using an estimate.
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