Return Processing

The cost to handle customer returns, including refunds, repackaging, and restocking. Amazon charges $3.20 per return for most categories. If 8% of your orders are returned, that’s $3.20 x 80 orders = $256/month in processing fees alone. Factor in lost product value if the item can’t be resold—some categories (like apparel) have 25%+ return rates.

SKU C9D8E7F6G5 is a $40 wireless charger. Last quarter, 18% of buyers returned it due to defects. Amazon processed 90 returns at $3.20 each ($288), and we lost $1,200 on unsellable stock. Total hit: $1,488. We switched suppliers in June and cut returns by half.