Returns and Refunds Analysis AI Prompt

Analyze product returns and refunds to identify root causes and financial impact.

Returns data: {{returns_data}} (order_id, product_id, return_reason, return_date, refund_amount)
Order data: {{order_data}}

1. Returns overview:
   - Return rate: returns / orders (by units and by order value)
   - Industry average by category: apparel 20-30%, electronics 5-10%, home goods 5-8%
   - How does this store compare?
   - Cost of returns: shipping + processing + inventory write-down as % of revenue

2. Return rate by product and category:
   - Products with highest return rates
   - Are certain categories structurally high-return? (Size/fit issues in apparel)
   - Products with increasing return rates: product quality issue or misleading listing?

3. Return reason analysis:
   - Classify return reasons: wrong size, defective/damaged, not as described, changed mind, arrived late
   - Volume and % for each reason
   - Controllable vs uncontrollable returns:
     - Controllable: not as described, wrong item sent, defective → operational fix
     - Uncontrollable: changed mind, wrong size ordered → policy and content optimization

4. Financial impact:
   - Gross return rate: returns / gross revenue
   - Net revenue = gross revenue - refunds
   - Contribution margin impact: for each return, the contribution margin of that order is lost, plus return cost
   - Annual cost of returns in dollars

5. Return prevention opportunities:
   - 'Not as described' returns → improve product descriptions, add more images, size guides
   - 'Wrong size' returns → add size recommendation feature or chat assistant
   - 'Defective' returns → supplier quality review
   - Products with > 25% return rate: review listing accuracy and product quality

6. Return policy analysis:
   - Does the current return policy drive returns? (e.g. free returns may incentivize 'bracket buying')
   - What would be the financial impact of moving from 30-day to 14-day return window?

Return: returns overview, product/category return rates, reason analysis, financial impact, prevention opportunities, and policy analysis.