Terms of Trade · Edition 2: The trading pack
Returns rate
Definition
Units or orders returned as a share of units or orders sold, in a period long enough for the returns to arrive. Highest in fashion, where fit cannot be tried before the parcel arrives; the revenue figure a board sees is often net of it and rarely labelled as such.
Field note
Returns rate is a measure of how accurate your photography is.
Board question
Is the revenue in this pack gross or net of returns, and what is the rate by category?
Applied through
The Review walks the product page, the parcel and the return as a customer does; Commercial Discipline in the Cat’s Whiskers puts the return cost where it belongs, inside the contribution margin.
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