What does a return really cost you? This is how you calculate the costs per returned package
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by Verpakkingdeals.nl
6 min reading time
A return costs more than just the outbound shipping. This is how you calculate all items, and this is how you limit the number of returns and the cost per return.
A package comes back. The box has been cut open with a knife, the item is still inside and looks unused. You refund the amount, put the item back on the shelf and think: that only cost me the shipping. In practice, a return is almost always more expensive than that. If you don't know how much more expensive, you also don't know which measures will pay for themselves.
What's included in one return
A return is not a single cost item, but a stack of small items that you rarely add up:
The outbound shipment that you don't get back: the transportation has been made.
The packaging of the outbound shipment: box, tape, filling, and seal are used.
The return shipment, if you pay for it yourself or include a free return label.
Your time: receiving the package, opening it, assessing the item, refunding, sending an email.
Making it resalable: new packaging, new label, sometimes cleaning.
Payment costs that remain for some payment methods after a refund.
Loss of value: seasonal items that come back too late to sell at full price.
Usually, only the first two items are clear. The rest disappears into 'normal work'.
How to calculate one return specifically
Take an item of €24.95 that you send in a letterbox package. Material is calculated from the bundle price: 100 recycled letterbox boxes A6 cost €17.95, so €0.18 per box. A VOID security seal costs €9.95 for 60 pieces, or about €0.17 per shipment. Tape from a roll of 50 meters at €3.00 and a piece of bubble wrap from a roll of €12.95 are added in the same way: roll price divided by the number of shipments you get from it.
Item
What you fill in
Outbound shipping costs
Your carrier's rate
Outbound packaging
Box, tape, filling, and seal, calculated per item
Return shipment
Only if you pay for it
Processing time
Minutes multiplied by your hourly rate
Repackaging
New box, new label, possibly new seal
Loss of value
Difference between full price and what you still get for it
Add it up and divide the total by your margin on that item. This way you know how many sales one return eats up. For items with a small margin, it's surprisingly many — and that's precisely the number that makes a conversation about sizing, photos, or packaging easier.
What you can and cannot pass on
When selling remotely to consumers in the Netherlands, there is a legal cooling-off period. The Authority for Consumers & Markets explains that this is basically fourteen days and that there are exceptions, for example, for certain sealed products. Who bears the costs of returning also depends on what you clearly stated in advance. For the exact conditions and the current text, check the ACM's page on cooling-off periods and adjust your general terms and conditions and your shipping page accordingly. If you are unsure about your situation, consult a lawyer — this article is a calculation aid, not legal advice.
What you do have control over: how clear you are about the size, content, and condition of the product, and how easy you make it for your customer to make the right choice before ordering.
What makes a return unnecessarily expensive
Three things make the difference between a return that you handle in five minutes and a return that takes half an hour:
No return instructions in the box. Without a note, items come back loose, without a packing slip and without an order number. Then you have to figure out who sent what.
No visible seal. With an opened shipment, it is not possible to determine afterwards whether anything has been exchanged. A seal shortens that conversation.
From return to resalable
Make assessment a fixed routine with three bins: directly back into stock, refurbish, and write off. Clear the middle bin once a week instead of per package — that saves switching tasks.
For the refurbishment bin, standard material helps. A new price tag can be quickly applied with an MX-5500 pricing gun for €24.95, including 5500 stickers and two ink rolls; refills are available with 5000 white price stickers for €9.95. Items with damaged original boxes can often still be sold well in neutral packaging, for example a white packaging box with magnetic closure of 9.5 x 9 x 10 cm for €5.00 — provided you honestly state on your product page that it is an item with replaced packaging.
Preventing returns pays double
Every return that doesn't happen saves you both costs and work. What yields the most in practice:
State sizes fully, in centimeters and in numbers: length, width, height, content, number of pieces per package.
One photo with a sense of scale: the item next to an everyday object, so no one makes a mistake about the size.
Mention what is not included: batteries, chargers, mounting materials.
Point out color deviations instead of photographing them away.
Translate questions from your mailbox back to your product page. Any question asked twice is missing from your description.
For one month, record the reason customers give for a return. Usually, one or two reasons combined cause half of your returns — and these can often be solved with a paragraph of text.
Get started with your own numbers
Take your last fifty orders, count the returns, and calculate one return completely with the items above. If you know what it costs, you'll immediately know what a better box, a seal, or an extra paragraph of product information is worth.
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