Free Tool

What are cash-on-delivery returns costing you?

Enter your orders, COD share, return rates and shipping costs. See your monthly loss from returned orders, and what each order you move from cash on delivery to prepaid is worth.

Calculator

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Starting values are an example store. The return rates use Razorpay’s typical ranges for India; replace everything with your own numbers.

Monthly loss from returned orders-
Orders returned each month-
Cost of each returned order-
Sales that never completed-Lost revenue each month, shown separately from costs
Each order moved from COD to prepaid is worth-in avoided return costs: a ceiling for any prepaid discount you offer
Saving if you cut COD returns by your target-
How it is calculated

The formula, in plain words.

  • Returned orders = COD orders × COD return rate + prepaid orders × prepaid return rate.
  • Cost per return = forward shipping + return shipping + packaging + (average order value × damaged share).
  • Monthly loss = returned orders × cost per return.
  • Value of moving one order to prepaid = cost per return × (COD return rate − prepaid return rate).

Benchmarks

Razorpay puts the typical RTO rate for cash-on-delivery orders in India at 25 to 30%, against 2 to 3% for prepaid orders (Razorpay). Your own numbers vary with category, price point, region and courier, so your shipping dashboard is the best source.

Reduce it

Four ways stores bring COD returns down.

Confirm before you ship

A WhatsApp message asking the customer to confirm the order and address before dispatch. Unconfirmed orders wait or get a call.

Make prepaid attractive

A small discount or free delivery for paying upfront. The calculator shows the most each prepaid order is worth to you.

Validate addresses and pin codes

Check serviceability and catch incomplete addresses at checkout, not at the courier hub.

Limit COD where it fails

Restrict COD for order values, products or areas with a history of returns, or ask for a small advance.

FAQ

COD and RTO questions.

RTO, or return to origin, is an order that ships but comes back to you undelivered: the customer refused it, was unreachable, or gave a wrong address. You pay shipping both ways, and the stock is out of circulation until it returns.
Razorpay puts the typical RTO rate at 25 to 30% for cash-on-delivery orders, against 2 to 3% for prepaid orders (Razorpay). Your own rate depends on category, price point, region and how you confirm orders, so use your courier data where you can.
Each returned order costs forward shipping, return shipping, packaging and handling, plus the value of any stock that comes back damaged. The calculator multiplies that by the number of returned orders. Sales that did not happen are shown separately, because they are lost revenue, not an extra cost.
The usual levers are confirming COD orders and addresses on WhatsApp before dispatch, validating pin codes, offering a small incentive to prepay, and restricting COD for order values or areas with a history of returns. Measure each change against your own baseline.
Yes. Switch the currency to AED and enter your own rates and costs. The calculation is the same wherever cash on delivery is common.
From our guides

Researched from vendor pages and official sources, with dates and prices checked.

All guides on e-commerce and payments →
Fix it in your store

We build COD confirmation into your order flow.

WhatsApp order confirmation, pin-code checks, prepaid nudges and COD rules on Shopify or WooCommerce. Tell us about your store and we will send a fixed quote within one business day.

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