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Home » Blogs » How to Reduce RTO in E-Commerce?
By Gaurav Parvadiya | Last Updated On August 12th, 2025
RTO isn’t just a metric on your shipping dashboard. It’s lost revenue, lost inventory, and lost trust.
Every time an order is returned without being delivered, you don’t just lose the sale. You pay twice for shipping. You tie up inventory. You absorb customer support hours. And worst of all, you signal to your logistics partner that your orders are risky. Frustrating! Isn’t it? You might be dying to find the answer to your question: “How to reduce RTO?”
Don’t worry, you’ll learn the best practices to reduce RTO from this article itself!
In markets like India, RTO rates for COD orders can climb as high as 30%. That means for every 10 packages you ship, 3 come back: untouched, unsold, and unpaid for.
And here’s the thing: most of it is preventable. Yes, it’s not so difficult to lower the return-to-origin in e-commerce.
Customers enter fake addresses. Or they forget they placed the order. Or they weren’t ready for delivery. None of these are warehouse problems; they’re workflow problems. But if you apply proper RTO reduction strategies, these issues can be solved, or at least reduced.
This guide isn’t filled with hacks. It’s built from systems, actual practices that brands use to reduce RTO in e-commerce and recover margin. You’ll learn how to screen risky orders, reduce failed deliveries, and stop COD rejections before they start.
The goal here is simple: Apply the best RTO reduction strategies, which are: fewer returns, more profit.
RTO in ecommerce: Return to Origin (RTO) is what happens when a shipped order comes back to you without ever reaching the customer. You can call it “order not delivered returns”. No delivery. No revenue. As simple as that. Just a round trip that costs you twice the logistics and none of the payoff.
In most cases, the product is perfectly fine. The issue lies with the handoff. And we are here to identify the reasons for high RTO and solve them one by one. So stay tuned.
Sometimes the customer isn’t available. Sometimes they never intended to accept the order. Other times, the delivery partner couldn’t find the address, or the customer simply didn’t pick up the phone. And if it’s COD, rejection rates are even higher; many buyers cancel emotionally, not logically.
Here’s the pattern most brands miss: RTO isn’t random. It’s repeatable.
You’ll start seeing the same ZIP codes, the same phone number patterns, and the same buyer behavior pop up again and again.
The bottom line? RTO isn’t just a customer issue. It’s a system design flaw. And once you spot where the breakdowns happen – at checkout, post-purchase, or during delivery – you can start fixing them before they bleed your business dry.
Most people assume RTO just means paying for shipping twice. That’s the surface cost, and it’s bad enough. But the real damage runs deeper.
When an order returns undelivered, you lose more than money. You lose time, trust, and operational momentum.
Here’s what you’re actually paying for:
According to a Unicommerce report, 30–40% of RTO items are returned in unsellable condition. That’s nearly half your returned inventory going straight to clearance or write-off.
If you want fewer failed deliveries, start where they begin: the checkout page.
Too many e-commerce brands treat shipping info like a formality. But one wrong digit in a phone number, or a missing landmark in the address, is all it takes for your package to circle back. And with COD orders, fake names and burner phones are more common than most founders realize.
Here’s what experienced operators do differently:
Use Autofill address tools: Use APIs to auto-suggest verified addresses as the customer types. This not only speeds up checkout but catches typos and incomplete entries before they cause problems.
Pincode validation in real time: Don’t wait until dispatch to discover that a location is unserviceable. Flag it right at checkout. A simple “We currently don’t deliver to this area” saves you from a guaranteed RTO later. It helps reduce RTO in e-commerce.
Mandatory phone verification for COD: Send a quick OTP before confirming the order. This one step alone filters out a large chunk of fake or non-serious orders.
Name and pattern filters: If you’re seeing multiple COD orders from accounts named “Test,” “Abcd,” or “Xyz,” it’s a red flag. Build logic into your system to either block or flag these for manual review.
And don’t forget microcopy. A simple line under the phone field – “We’ll use this number to confirm delivery, please double-check it” – reminds users this info matters.
The goal isn’t to make checkout harder. It’s to make every order more likely to land at the right door, the first time.
If COD is the root cause of your RTO problem, prepaid is the fix – but you won’t move the needle just by offering it. You have to make it appealing.
Most customers choose COD not because they want to, but because they’re unsure. Maybe it’s their first time buying from your store. Maybe the product is new to them. COD feels safer, even if it costs you more.
That’s where incentives work. It’s one of the best practices to reduce RTO.
Instead of removing COD entirely (which will hurt conversions), gently nudge customers toward prepaid by giving them something in return.
Here’s what actually works:
Flat discounts: A simple “Get $50 off on prepaid orders” is clear and effective. Place it next to the payment options at checkout, not buried in your marketing banner.
Faster shipping: Promise express delivery for prepaid users. Frame it as a VIP benefit: “Prepaid orders ship 1 day faster.” This appeals to urgency without seeming pushy.
Freebies or loyalty points: For returning customers, offer loyalty points or small freebies on prepaid. Over time, they’ll shift behavior naturally, because now it feels like a win.
Post-order upsell: Even after someone places a COD order, you can follow up via WhatsApp or email: “Want to switch to prepaid and get $30 off? Tap to update.” Tools like Razorpay and Cashfree support instant payment links for this.
The key is consistency. One good incentive won’t shift the needle. But showing prepaid benefits every step of the way? That builds new habits.
If you’re shipping nationwide without filters, you’re playing RTO roulette.
Not every location is equal when it comes to delivery success. Some pincodes are consistent money losers – high rejection rates, fake addresses, and long delays. The mistake? Brands treat all customers the same at checkout.
Here’s how experienced operators apply the best RTO reduction strategies and tighten the net:
Identify high-risk zones: Go through your RTO reports by pincode. If certain areas consistently generate undelivered or rejected orders, flag them. You don’t have to block them, but you should adjust how you serve them. That is how you can reduce RTO in e-commerce.
Apply COD restrictions: In risky zones, offer prepaid only. If COD is non-negotiable, add stricter validation, like mandatory phone OTP or courier call confirmation. It won’t kill conversion, but it’ll weed out the junk.
Score buyer behavior: Look beyond location. Repeat offenders – customers who’ve failed 2–3 deliveries – should be auto-tagged. Limit their payment options or require prepaid on future orders.
Choose couriers strategically: Not all logistics partners perform the same in every region. Some have better success in Tier 3 towns; others in metros. Use the right courier for the right pincode. Tools like Shipway, iThink Logistics, and NimbusPost can help automate this logic.
Delay dispatch for verification: For red-flag orders (new customer + COD + risky zone), hold the shipment for 24 hours. Send a quick message: “Just confirming, are you ready to receive your order tomorrow?” If they don’t respond, don’t ship.
This isn’t overengineering. It’s about using your own data to ship smarter, not just faster.
Most failed deliveries don’t happen because something went wrong during shipping. They fail because no one asked if the customer was ready in the first place.
Before your product leaves the warehouse – especially if it’s COD – you should know whether someone will actually be there to receive it.
Here’s how smart brands fix this:
Send a “Ready to Receive?” message: One day before delivery, shoot a WhatsApp or SMS: “Your order is packed and ready to ship. Will you be available to receive it tomorrow between 1–4 PM?”
Add two quick reply buttons: ✅ Yes, I’m available ❌ No, reschedule
No reply? Don’t ship: Simple rule. If there’s no confirmation, hold the order. That one step alone can cut your RTO by 25–30% in high-risk zones. It’s a soft filter, not a friction point.
Bonus: confirm delivery address: This is your last chance to fix typos or incomplete details. Add a quick line: “Please confirm your delivery address: [autofilled address]. Reply YES or update.”
Automate the logic: Tools like Interakt, Zoko, or QuickReply.ai can handle this without a human in the loop. You set the flow once, and it runs every day, filtering orders before they become losses.
This step won’t cost you much. But it can save thousands a month in wasted shipping, especially on COD-heavy catalogs.
Think of it as a seatbelt: small effort, massive payoff.
You’d be surprised how many RTOs happen because of simple user mistakes.
Wrong size. Wrong color. Wrong address. Maybe they were in a rush during a flash sale. Maybe they clicked the wrong thing. Maybe they changed their mind two minutes after checkout.
If you lock the order right away, you leave no room for correction. And that mistake turns into an expensive return.
Here’s how brands reduce that risk:
Give a 30–60 minute edit window: Let customers make quick changes right after checkout, without needing to cancel and reorder. Show a countdown timer like: “You can edit your order for the next 45:00 minutes.”
Allow edits via WhatsApp or the app: Some customers won’t go back to your website. Let them respond via a quick message: “Need to change size or address? Tap here to update your order before it ships.”
Show what’s editable: Keep it clear: address, variant (size/color), quantity – not payment method or core product. Simplicity here reduces confusion.
Don’t make it manual: Use tools like Orderhive, Unicommerce, or Gokwik’s post-purchase flows to automate editable windows before dispatch.
Why does this matter?
Because most customers won’t bother emailing your support team to fix a mistake. They will just ghost the delivery.
And if you’re wondering whether this reduces trust, it doesn’t. It increases it. Giving buyers control after purchase signals that you care more about the outcome than the transaction.
That builds confidence, and cuts RTO at the source.
This one might sound counterintuitive, but hear it out.
You’d think that having a flexible return policy would increase returns. In reality, it reduces RTO.
Why? Because most RTOs come from doubt, not bad intent.
If a customer isn’t sure they can return something after it arrives, they’re far more likely to reject it at the door. Especially if they chose COD. Especially if they’re unsure about size, fit, or product quality.
Here’s how to flip that fear:
State your return policy clearly: Don’t bury it in the footer. Mention it on the product page, at checkout, and in the order confirmation email. Use simple language like: “Easy 7-day exchange if it doesn’t fit. No questions asked.”
Make the process easy: If returning something requires three emails and a phone call, it’s not really a return policy, it’s a deterrent. Let users initiate exchanges via the app, WhatsApp, or a single-click form.
Offer flexible options: Allow “exchange on delivery” or instant pickup from the customer’s address. If they know they can swap a wrong size without hassle, they’re more likely to accept the first delivery.
Use trust-building microcopy: A simple line like “Worried it won’t fit? You can always exchange it” next to the buy button can calm hesitation in the moment that matters.
A report from Narvar showed that 76% of first-time buyers check the return policy before making a purchase, and poor policies are a top reason for cart abandonment and delivery rejection.
So don’t just publish a return policy. Engineer one that reduces fear, signals trust, and keeps your deliveries accepted, not bounced.
One of the most overlooked ways to reduce RTO? Give your customers better ways to pay.
If all you’re offering is COD and prepaid cards, you’re missing the middle – and that middle is where most drop-offs and rejections happen.
Here’s the truth: not everyone trusts online payments. But not everyone wants to pay cash either. The gap is confidence. Your job is to bridge it.
Here’s how:
Offer UPI as a default option: In India, especially, UPI has surpassed card payments in both ease and trust. Make it visible. Make it fast. Make it the first option your buyer sees.
Enable “Buy Now, Pay Later” (BNPL): Platforms like Simpl, LazyPay, and ZestMoney let users delay payments without choosing risky COD. This reduces hesitation, especially for higher-ticket items.
Add wallet integrations: For returning customers, wallets like Paytm or PhonePe offer one-tap checkout and a faster, more committed transaction flow.
Use microcopy to reduce payment fear: For example- “All payments are 100% secure. You’ll receive full refund support if anything goes wrong.”
Give COD fallback, with conditions: COD shouldn’t be your fallback. It should be conditional. Use prepaid as the primary CTA, but allow COD for verified users, low-risk areas, or orders below a certain value.
This isn’t about giving more choices, it’s about giving more confidence.
If your payment flow feels flexible, safe, and modern, more users will commit to receiving the product, not just placing the order.
If you’re not screening your orders for fraud, you’re not just risking revenue, you’re inviting RTO. But you are here to lower the return to origin ecommerce.
Fraud in eCommerce isn’t always some big, organized scam. It’s often casual abuse: fake names, junk addresses, prank orders. And 90% of the time, it shows up in your COD flow.
The solution isn’t complicated tech. It’s a practical pattern recognition.
Here’s what experienced brands do:
Flag suspicious names and addresses: If you see orders with names like “Test Test” or “XYZ XYZ,” don’t let them through. Same with empty streets or generic buildings that don’t match the PIN code. Set rules in your backend to auto-flag these.
Check for duplicate orders: Some users will place the same item three times – different sizes, different addresses – and reject what they don’t want. Track email, phone, and IP combos to spot repeat abuse.
Use fraud detection tools: Platforms like Signifyd, Thirdwatch (by Razorpay), and Gokwik offer real-time risk scores. You don’t have to guess, just sort orders by risk and decide who gets COD.
Add a manual review step for high-risk COD: If the system flags an order as suspicious, hold it. Send a WhatsApp:
“Hi, we’re about to ship your order. Can you confirm your address and availability?”
No reply? Don’t dispatch. That’s how you can lower return to origin ecommerce.
Limit COD for new customers in red zones: If a pincode is high-risk and the buyer has no order history, require prepaid. Or better yet, offer a prepaid incentive as a soft nudge.
This isn’t about saying no to customers. It’s about saying no to orders that were never serious to begin with.
Every fraud filter you add is one less undelivered box eating your margin.
Most RTO problems don’t happen because the buyer didn’t like the product. They happen because the buyer felt uncertain, forgotten, or confused after they placed the order.
If your brand goes silent after checkout, don’t be surprised when the customer forgets they even ordered.
The fix? Stay in touch, in a way that feels human, not robotic.
Here’s what works:
Send a confirmation that actually confirms something: Don’t just say “Thanks for your order.” Let them know what’s next:
“Your order has been received! We’re prepping it now and will ship it within 24 hours. You’ll get a tracking link the moment it’s out the door.” Giving all the shipping details from time to time to the customer is one of the best RTO reduction strategies.
Use their name: Tools like Interakt, Klaviyo, or Gokwik can personalize messages at scale. A line like “Ravi, your order #1234 is arriving tomorrow, make sure someone’s available” builds trust and ownership.
Add relevant post-purchase tips: If someone buys shoes, send a quick message:
“Your sneakers are on the way! Pro tip: let them air out for a day before wearing.” This adds perceived value and reminds them that the order is real and personal.
Use the same channel you sold on: If your customer came through WhatsApp, don’t switch to email. Keep the conversation where it started. It makes it feel like a relationship, not a system.
Give them control: Let customers track, reschedule, or cancel orders from the same thread. If they feel empowered post-checkout, they’re more likely to receive, not reject.
Post-order silence is the easiest way to lose a sale before it ships. But smart, friendly communication? That’s how you turn intent into delivery. That’s how you lower return-to-origin ecommerce.
If you’re treating every RTO like a one-off incident, you’re missing the big picture.
Behind every failed delivery is a signal. A pattern. A story. And if you’re not actively tracking those patterns, you’re doomed to repeat them, at scale.
The brands that win at RTO reduction don’t just react. They analyze. They know how to reduce RTO in the best way possible.
Here’s how to start with the best practices to reduce RTO like the way they do it:
Log every RTO reason: Don’t just mark it “undelivered.” Ask your courier for the exact reason:
Tag each return with a cause, and build a dashboard to track trends by product, region, and payment mode.
Map repeat offenders: Are the same customers placing and rejecting orders? Create a suppression list. You don’t need to ban them, just restrict COD or hold dispatch until they confirm.
Zoom in on product-level RTO: Are certain SKUs being rejected more often? Maybe sizing is unclear. Or the product looks different in photos. A single product with a high RTO rate could silently drain your margin.
Tie RTO to the acquisition channel: You might find that Facebook ads bring more impulse COD shoppers who ghost deliveries, while WhatsApp campaigns convert better to prepaid. Use this data to adjust your media mix.
Review shipping partner performance: Sometimes, the issue isn’t your customer, it’s your courier. Missed delivery windows, bad handling, or poor communication can spike RTOs in specific zones. Switch where needed.
You don’t have to fix everything overnight. But once you start tracking RTO in e-commerce like a business metric – not a logistics nuisance – you’ll see exactly where the leaks are
And more importantly, how to patch them.
If you’ve nailed the basics but want to squeeze your lower return to origin ecommerce, here are a few extra tactics that seasoned DTC brands swear by:
Use Visual Proof at Delivery: Ask your courier partners to capture a photo of the delivered product at the customer’s door (with consent). This adds an audit trail, especially for “I never got it” claims. Many last-mile apps support this out of the box.
Add Product Videos or Try-On GIFs: Photos aren’t always enough. A quick 10-second clip showing how a product looks in real life can increase buyer confidence and reduce regret-based RTOs. It’s one of the powerful RTO reduction strategies.
Offer “Open Box Delivery” for High-Risk SKUs: For items prone to returns (like electronics or fashion), offer open box delivery where the courier stays while the buyer checks the item. If the product is right, they accept. If not, it returns immediately, saving a second trip and support hassle.
Use Exit-Intent Popups for COD Orders: Before a COD customer leaves the site, show a pop-up: “Want to prepay and get 10% off? Grab your reward now.” This last-minute nudge is particularly effective on mobile devices.
RTO won’t vanish overnight. However, it’s not just a shipping issue; it’s a full-funnel problem that affects your marketing, product, checkout, and customer support. But you can reduce RTO in e-commerce.
When you take the process of how to reduce RTO seriously, everything else gets sharper: your targeting improves, your UX gets tighter, and your buyer trust increases. And best of all, your margins stop leaking from every undelivered box.
Gaurav is the founder and CEO of Twinr, a tech entrepreneur with a decade of experience and a passion for SaaS. With a Master's degree in Computer Science, he specializes in no-code development, driving innovation in the mobile app industry. When he's not busy growing the company, you'll find him writing about tech, growth, software development, e-commerce, and occasionally sneaking in a game of badminton.