A logistics term used in Indian ecommerce for failed delivery attempts where the package is returned to the seller — most commonly associated with cash-on-delivery orders where the customer is unavailable or refuses delivery.
RTO is one of the biggest margin destroyers for Indian D2C brands. Each RTO incurs: forward shipping cost, reverse logistics cost (INR 80-200), product handling cost, and potential damage or resale loss. Average RTO rates in India: 10-15% for COD orders, 1-2% for prepaid. Brands using phone verification OTP, IVR confirmation, and COD surcharges typically reduce COD RTO to 5-8%.
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