A 25% return rate in apparel isn't a red flag

The founder of an apparel brand we work with emailed me one morning, a bit panicked. Her return rate was at 25%. She asked me if it was serious, if there was a big sizing problem, if she needed to rethink everything. I reassured her right away. 25% is perfectly normal.

Across the fifty-odd fashion brands we track, the average return rate sits between 20 and 30%. So at 25%, she's dead center. Nothing abnormal. Except the problem is somewhere else. And that's what I want to break down here. Because as long as it stays within range, the return rate simply isn't the number you should be watching.

Why 25% is nothing to worry about in fashion

In apparel, people order, try things on at home, and send back whatever doesn't fit. That's the model. You don't buy clothing the way you buy a face cream or an accessory. You often order two sizes, keep the one that fits, send the other back. It's become a buying reflex.

I listened to a podcast from a brand that specializes in women's trousers. Their return rate on the more complex styles hit 38%. And this is a company that sells almost nothing else, that knows its product inside out. It was reassuring to hear that, and it reassures our clients too when I tell them the story. Because returns are structural in fashion. The more your product needs a try-on, the higher the rate climbs. A fitted trouser gets returned more than an oversized tee, simple as that.

One detail that changes how you read the number entirely. The return rate is calculated on the value of returns for a product against its gross sales, before returns. So it's adjusted per product, not drowned in your whole catalog. One product can crush it on sales and still show a healthy return rate, while another, sold three times, hands you an 8% figure that wrecks the average. Look product by product before drawing conclusions.

The right move when the rate really climbs

If one day the return rate explodes, say you jump from 25% to 40%, then yes, you investigate. And you investigate broadly. You look at the full price versus discount split, you look by market (France versus international, often very different), you look by product category. Tools like Kleep let you cut sizing-related returns by displaying "this product runs small, size up" based on past returns. We tested it with a client. Honestly, it wasn't miraculous, but for some brands with a genuine sizing issue, it's worth a look.

But as long as you're between 20 and 30%, stop stressing over this number. It moves, it will keep moving, that's normal.

Logistics, the cost you don't see

Nobody really looks at their logistics. The return rate on its own tells you nothing about your profitability. What eats your margin is the logistics cost of each return. And it's invisible unless you dig.

A return is expensive. Really expensive. There's the return shipping, often billed through Chronopost by your fulfillment provider. But that's just the start. Before that, you've already paid for the outbound shipment (Chronopost or Colissimo rebilled), order prep, packaging. So when a customer sends an item back, you've eaten all those costs for zero sale. The parcel did a round trip, your margin took a hit, and you earned nothing.

For the brand I mentioned, total logistics costs run around 13% of revenue. That's within range too, according to our benchmark. But the trap is looking at that number month by month without thinking.

The example that sums it all up

In July, this brand did €50k in gross sales. Not huge. And the founder tells me "I don't get it, I've got €4,800 in shipping costs when we barely sold anything this month." Of course she doesn't get it if nobody explains it.

That month, there were 14 return cases. Those returns came from orders in previous months, placed when volume was higher. So in July, she collects little in sales but pays the logistics bill for the accumulated returns. Returns, unfortunately, can't be predicted. And especially if customers file them all at once, they drag down the cost for the week or month they land in.

Hence the rule: never judge a month's profitability without adjusting for returns. A low-volume month with lots of delayed returns will look catastrophic even though your cost structure is healthy. It's a timing lag, not a fundamental problem.

How to read a good month without getting it wrong

Let's take September for this same brand. Better month than July. Natural reflex, you think "great, sales picked up." Except no. September came out better, but not thanks to sales. First because there were fewer returns, so less logistics cost against the margin. Then because gross margin was better, fewer low-margin resale products in the mix. Two effects stacking up to make a good month, without a single extra sale being responsible.

If you'd only looked at revenue, you'd have understood nothing about what happened. You'd have believed in a commercial rebound when it was really a margin and returns mechanic. Looking at revenue alone means getting the diagnosis wrong half the time. That's also why an eCommerce audit should always start with your P&L and not with your ad campaigns.

Where to find the right numbers

Quick note on data reliability, because it's not the same depending on what you're looking at.

The return rate, you pull it straight from Shopify. The "Sales Reverse Sold" section (often renamed in reports). There, little room for error, it's clean data, you can lean on it with your eyes closed.

Logistics costs are another story. You have to dig them out of your provider's invoices. It's tedious, it's not automatic, and that's why most brands underestimate or ignore them. They see the return rate on Shopify, feel reassured or worried, but never reconcile it with the actual billed cost. And that's where margin leaks.

If you want to build your reporting properly, start by reconciling your logistics invoices with your sales month by month. It's not sexy, but it gives you the real picture. And it also changes how you build your ad budget from your margin rather than from your revenue.

What you should actually watch

In practice, here's what you watch. Your return rate between 20 and 30%, you leave it alone. You keep an eye on it to catch a sudden drift, that's it. As long as it stays in that range, it's not your problem.

First, watch your full logistics cost per order, returns included, reconciled against your provider invoices. Also keep an eye on the timing lag of returns, it distorts how you read your small months. And calculate your gross margin adjusted for returns and the weight of resale, because that's what tells you whether your month was worth anything.

The return rate is just customer behavior. What eats margin is the logistics bill behind it. Go pull your Chronopost invoices from the last quarter and reconcile them with your sales month by month. Nine times out of ten, the numbers tell a different story than the one you're telling yourself.