Landed cost
Bring product, freight, duty, and fees into one number.
Costs & conversionCOSTS & CONVERSION
Returns & Reverse Logistics Cost Calculator
Model return volumes and four disposition routes with visible recovery and processing assumptions.
Returns & reverse-logistics cost calculator
Model return volumes and four disposition routes with visible recovery and processing assumptions.
YOUR RESULT LIVE CALCULATION
Estimated reverse-logistics burden
$2,080period burden
PROCESSING COST + UNRECOVERED INVENTORYCommon processingDisposition workFixed period costsInventory value lostOriginal outbound lost
- Expected returned units
- 100
- Processing and fixed costs
- $1,240
- Returned inventory at original cost
- $4,000
- Estimated recovered inventory value
- $3,160
- Unrecovered inventory value
- $840
- Unrecoverable original outbound cost
- $0
- Burden per returned unit
- $20.8
- Burden per shipped unit
- $2.08
Expected units may be fractional. Recovery is measured against original inventory cost, not selling price or cash receipts. Refunds, reversed revenue, taxes, replacement shipments, and normal outbound costs are excluded. Fixed period costs remain even if expected returns are zero. This is not an accounting posting or write-off decision.
Expected disposition and recovery
4 rows
| Disposition | Share % | Expected units | Recovery % of cost | Recovered value | Disposition processing | Unrecovered inventory |
|---|---|---|---|---|---|---|
| Return to stock | 60 | 60 | 100 | 2,400 | 120 | 0 |
| Refurbish | 25 | 25 | 70 | 700 | 200 | 300 |
| Salvage / recycle | 10 | 10 | 15 | 60 | 10 | 340 |
| Dispose | 5 | 5 | 0 | 0 | 10 | 200 |
BEHIND THE NUMBER
How the calculation works
Expected returns equal shipped units times the return rate. Assign 100% of returns across stock, refurbishment, salvage, and disposal. Each route has a processing cost and a percentage of original inventory cost recovered; disposal recovery is zero. Recovered value offsets original inventory value, not processing costs. The example yields 100 returns, $1,240 processing and fixed costs, $840 unrecovered inventory value, and $2,080 total burden.
Burden = common processing + disposition processing + fixed period costs + original inventory cost not recovered + unrecoverable original outbound cost.
When this calculation helps
Separate return processing, route-specific handling, and unrecovered original inventory value. A per-return denominator answers a different question from spreading the same burden across all outbound units.
Check the interpretation
Disposition shares must describe the entire expected return cohort. Recovery percentages refer to the entered original-cost basis, not proven resale receipts. Refunds and reversed revenue are excluded; adding them without reconciling the boundary can count one economic loss twice.
Use one currency throughout. Recovery percentages are assumptions, not resale-price estimates. Refunds, reversed revenue, taxes, replacement shipments, and ordinary outbound costs are excluded to avoid double counting. Enter only incremental, nonoverlapping processing amounts. This is a planning comparison, not an accounting or write-off policy.
FedEx reverse-logistics and disposition servicesWorked example: Returns Cost: Separate Processing, Recovery, and Lost Inventory Value
Good to know
Why are customer refunds excluded?
A refund reverses a sale; adding it to inventory loss and costs can double count the economic impact. This calculator isolates reverse-logistics costs and inventory recovery, not total profit after a return.
What happens with no returns?
Fixed period costs remain. Burden per return is N/A when returns are zero; burden per shipped unit is N/A when shipped units are zero.