22/05/2026
Quick story we keep running into when we talk to WooCommerce store owners.
A store does $50 average order value. Cost of goods is $25. Shipping out is $5. Payment processing eats another $5. So they're netting around $15 per sale. Feels solid.
Then a return comes in. The customer wants their money back. The store refunds the $50 and figures the cost is just $50 in lost revenue.
It's not. Here's what actually happened:
The $25 product is back (good news)
$5 outbound shipping is gone
$5 return shipping is on the store now
$5 processing fee is non-refundable — Stripe and PayPal keep it
Plus 15 minutes of someone's time handling it
That's a $17 loss on a return where the product comes back in resellable condition.
If the product comes back used, stained, or damaged — and a real chunk of them do — the math gets worse. You're losing the $25 product on top of everything else. Total hit per damaged return is around $42.
One damaged return wipes out the profit from nearly three successful sales.
This is the cost most WooCommerce store owners don't track because the dashboard only shows the refund line. The cascade behind it never makes it onto a report.
Question for the apparel folks especially — roughly what percentage of your returns come back in resellable condition vs. used or damaged? Curious if it matches what we're seeing.