Effective Ways to Reduce RTOs for Your Shopify Store

You put time, effort and money into your Shopify store to drive sales, curate perfect products, create product listings, and so much more. Yet, are your orders bouncing back? 

This is Return-To-Origin (RTO), a deadly reality for many budding brands. The unpredictable behaviour of the buyer and failed deliveries eat into profits. In India, for 65% of buyers, COD still remains the preferred mode of payment, making Shopify COD order RTO issues a frequent concern for online sellers.

With RTO rates on the rise, finding efficient ways to manage and minimise returns becomes essential to make profits. Curious how to reduce RTO in Shopify and protect your profits? Discover smart strategies in our latest guide! Here are the best practices to slash RTOs and keep your Shopify store growing.

How will RTOs impact your Shopify store?

1. You will have to bear reverse logistics costs.
2. If the products are damaged, you will have to bear that cost, too
3. Your inventory will be blocked 
4. Reduces the cash flow needed to run the business
5. Eat your profits

Most Common Reasons for RTOs

Customer Lacked Intent to Buy the Product

In some cases, customers may add items to their cart and complete the checkout process impulsively without a strong intent to follow through with the purchase. This is particularly common with COD orders, where customers aren’t financially committed to the purchase until the product is actually delivered.

• Impulsive Buying: This often leads to returns as customers may change their minds after placing the order, especially if it was an impulsive decision.
• Window Shopping: Some customers treat COD as a way to “reserve” items for inspection upon delivery without real intent to buy.

To address this, offering incentives for prepaid orders or implementing order confirmations can help gauge true buyer intent and reduce RTOs.

Customer Provided an Incorrect Address or Wasn’t Available for Delivery

Delivery attempts can fail if the customer has entered an incorrect, incomplete, or non-deliverable address during checkout. Address errors are especially problematic in COD cases, where a failed delivery attempt can mean an automatic return to origin.

• Incorrect Address: Small mistakes, like a missing apartment number or wrong PIN code, can result in failed delivery attempts.
• Unavailable Recipient: In some cases, customers may not be at home or reachable during the delivery window, leading to returns.

To reduce such issues, consider implementing address verification tools or sending address confirmation messages before dispatch.

Fake Delivery Attempt by the Logistics Partner

Occasionally, RTOs happen due to reasons outside of the customer’s control. Fake delivery attempts, where the logistics partner marks the order as undelivered even if they haven’t attempted to deliver it, are unfortunate but real challenges. These incidents occur due to various factors such as logistical inefficiencies, shortage of delivery staff, or simply miscommunication within the delivery team.

• Misreported Delivery Status: The delivery agent might inaccurately report that the customer was unavailable or the address was incorrect.
• Delivery Challenges: In high-demand areas, fake attempts can sometimes occur to clear backlogs, leading to unjustified RTOs.

Choosing a reliable logistics partner and keeping open communication channels with the delivery team can help you address and track down these issues promptly.

Customer Refused the Order (More Common in COD Cases)

COD orders carry higher RTO risks because customers can easily refuse to accept the order when it arrives, either due to buyer’s remorse, financial constraints, or simply a change of heart. Refusals are often linked to:

• Lack of Financial Commitment: Since the customer hasn’t pre-paid, there’s no financial obligation, making it easy to refuse the product upon delivery.
• Misunderstanding or Mismatched Expectations: Sometimes, the customer’s expectations don’t align with the product due to unclear product descriptions, leading them to refuse it.
• Delayed Delivery: If the product arrives later than expected, the customer may have lost interest or acquired a substitute.

Offering incentives to convert COD to prepaid, confirming COD orders with follow-up messages, and providing clear product descriptions can help mitigate these refusals.

7 Proven Ways To Reduce COD RTOs for Your Shopify Store

1. Optimise Product Descriptions to Set Clear Expectations

One of the most straightforward ways to reduce RTOs is to ensure your customers know exactly what they are purchasing. An accurate, detailed product description with high-quality images helps avoid misunderstandings and post-purchase dissatisfaction, which often leads to returns. Outline essential information like product specifications, dimensions, materials, and care instructions. By providing transparent details, you minimize the chances of customers changing their minds upon delivery.

2. Provide Proactive Customer Support for Issue Resolution

Proactive customer support not only builds trust but can also prevent many RTO cases. Establishing a clear line of communication through various channels like live chat, email, or WhatsApp makes it easier for customers to resolve their doubts about an order before it’s shipped. You can also use follow-up messages post-purchase to provide additional support and address any potential issues before the package reaches the customer’s doorstep.

3. Confirm Orders Through Pre-configured Messages

Sending order confirmation messages is a simple but effective way to verify orders before dispatch. Automated SMS or email confirmation reduces the chances of orders going to unresponsive or uninterested buyers, reducing failed deliveries. This practice is particularly effective for COD orders, as it helps gauge the buyer’s commitment to receiving the product. A simple message that confirms details such as delivery address, expected delivery time, and payment mode can help avoid unnecessary RTOs.

4. Verify Addresses to Minimise Delivery Failures

Address verification is an important step in minimising RTOs, especially when delivering to remote or unfamiliar areas. With shipping platforms like Dispatch, your customers can verify and update their addresses by replying to a WhatsApp message. 

Dispatch helps ensure that customer addresses are accurate and within your delivery zones. It’s tech-enabled tools can help detect incomplete or incorrect addresses, reducing failed delivery attempts.

5. Convert Risky COD Orders into Prepaid Orders

COD orders are inherently more prone to returns than prepaid orders, as they carry less buyer commitment. Converting risky COD orders into prepaid ones can be a game-changer for reducing RTO rates. Consider offering incentives like small discounts or rewards to encourage customers to prepay. Additionally, using technology to flag risky orders based on patterns or previous purchase behaviour can help focus efforts on encouraging prepaid transactions for those specific customers.

6. Partner with Reliable Logistics for Efficient Deliveries

Choosing a dependable logistics partner can make all the difference in minimising RTO rates. Look for shipping aggregators with strong track record of COD management, delivery timelines, and flexible delivery attempts. Services like address validation, real-time tracking, and delivery rescheduling can significantly reduce failed delivery attempts. Logistics aggregators like Dispatch provide you with multiple courier options, which is required, especially during the peak season when demands are high. It also offers “reverse logistics” solutions that streamline the process of handling returns efficiently, saving your store time and resources.

7. Analyze RTO Data to Understand Patterns and Trends

Collecting and analysing data on RTOs can provide valuable insights into common causes and high-risk areas. Understanding patterns related to specific regions, product categories, or buyer profiles can help you fine-tune your strategies. For example, if you notice a high RTO rate from a particular area, you might restrict COD options or limit delivery attempts there. Tracking RTO reasons helps you adapt and make data-driven decisions to minimise future returns.

The Bottom Line

Reducing RTO rates is critical to keeping your Shopify store profitable. By optimising product descriptions, implementing proactive customer support, confirming orders, verifying addresses, converting COD to prepaid where possible, partnering with reliable logistics, and analysing RTO data, you can take effective steps to cut down RTOs. With these practices in place, you’ll enhance customer satisfaction, reduce operational hassles, and ultimately boost your bottom line.