Retail Chargeback Cost Calculator
See what compliance failures are actually costing you—and what you could save with proper prevention and dispute processes in place.
Your Numbers
Enter your current retail shipping profile. We'll calculate your estimated chargeback exposure and potential savings.
Total revenue from shipments to retail partners
Percentage of revenue lost to chargebacks (industry avg: 2–4%)
Number of PO shipments to retailer DCs per month
Average invoice value per retail PO shipment
Percentage of chargebacks you currently dispute (most brands: <10%)
Your Chargeback Exposure
Current State
With Optimized Compliance
Maximum Potential (99.5% Compliance)
We'll review your actual chargeback data and show you where the biggest savings are.
How These Numbers Work
This calculator models the financial impact of two levers: operational prevention and systematic dispute recovery. The assumptions behind the calculations are based on patterns we see across brands shipping to 60+ retailers.
Prevention: 70% Reduction in Preventable Chargebacks
Approximately 75% of all retail chargebacks are caused by controllable operational failures—ASN errors, labeling mistakes, routing guide violations, and packaging non-compliance. Proper compliance infrastructure (automated ASN validation, pre-built label libraries, carrier optimization) typically reduces these by 70% or more. The calculator uses 70% as a conservative estimate.
Dispute Recovery: 50% Success Rate
Of the remaining chargebacks, roughly half are disputable with proper documentation—carrier delivery confirmations, ASN transmission logs, and compliance photos. The 50% success rate reflects the industry average for brands with systematic dispute processes. Brands without documentation dispute less than 10% of chargebacks.
The 99.5% Target
The maximum potential savings assumes you achieve 99.5% compliance—a realistic target for brands with proper 3PL infrastructure. At 99.5% compliance, your chargeback rate drops to approximately 0.5% of revenue, representing the residual chargebacks from factors outside your control (carrier issues, retailer errors, system glitches).
We get a lot of requests from large retailers. Productiv's willingness to accommodate work from us and have awesome communication is really what makes them a head above other people we've talked to.
The brands that achieve the lowest chargeback rates do so because their 3PL has the compliance infrastructure already built—pre-wired EDI connections, validated ASN configurations, and existing label templates for their specific retailers. Onboarding to a provider with this infrastructure in place is the fastest path from a high chargeback rate to a low one.
Want to see what your actual chargeback data reveals?
This calculator uses industry averages. We can analyze your specific chargeback history to identify where the biggest savings are hiding—and build a plan to capture them.
Talk to our teamIf the numbers in this calculator are surprising, that is exactly the point. Chargebacks accumulate gradually and are easy to dismiss as a cost of doing business. But they are not a cost of doing business—they are a cost of doing business without proper compliance infrastructure. The gap between your current chargeback rate and the 0.5% target is almost entirely addressable through operational setup and process engineering. Start a conversation about where your compliance gaps are and how to close them.
Paul Baker
CFO, Productiv
Paul co-leads Productiv alongside Doug Legan, bringing two decades of hands-on experience in 3PL operations, kitting, fulfillment, and embedded manufacturing.
Frequently Asked Questions About Chargeback Costs
How is the chargeback cost calculated?
The calculator multiplies your annual retail revenue by your estimated chargeback rate to determine total annual chargeback costs. Industry averages range from 1% to 5% of gross invoice value, with most brands experiencing 2% to 4%. The calculator then models the impact of operational prevention (reducing preventable chargebacks by 70%) and systematic dispute recovery (50% success rate on disputed chargebacks) to estimate potential savings.
What is a typical chargeback rate for retail suppliers?
Chargeback rates vary by retailer and product category, but most brands shipping into major retailers experience rates between 1.5% and 5% of gross revenue. Walmart's OTIF penalty alone is 3% of COGS on non-compliant shipments. Brands with proper 3PL setup and compliance infrastructure typically achieve rates below 1%. Brands with poor compliance or manual processes can see rates above 5%.
What does 'preventable chargebacks' mean?
Preventable chargebacks are those caused by controllable operational failures: ASN configuration errors, labeling mistakes, routing guide violations, and packaging non-compliance. Approximately 75% of all chargebacks fall into this category. The remaining 25% result from factors outside the supplier's control — carrier delays, retailer receiving errors, and system issues. Prevention through proper setup can eliminate most of the controllable chargebacks.
How realistic is 70% prevention of preventable chargebacks?
Seventy percent reduction in preventable chargebacks is a conservative estimate for brands that move from manual processes to a 3PL with automated compliance infrastructure. The operational fixes are well-understood: generate ASNs from actual shipment data (not PO data), use pre-built label templates for each retailer, automate routing guide compliance checks, and select carriers based on transit time to specific DCs. Brands starting with high chargeback rates often see even larger improvements.
Why does the calculator show a 50% dispute success rate?
A 50% success rate on disputed chargebacks is the typical range we see when brands have systematic documentation — carrier delivery confirmations, ASN transmission logs, and compliance photos. Without documentation, the success rate is near zero. With complete documentation and timely filing, rates of 40% to 60% are common. The actual rate depends on the mix of chargeback types and the quality of available evidence.
Can I achieve zero chargebacks?
Zero chargebacks over an extended period is extremely difficult because some variables are outside your control. Carrier delays, retailer receiving errors, and system glitches can all trigger chargebacks that are not your fault. The realistic target is below 0.5% chargeback rate with a systematic dispute process for the invalid ones. At that level, chargebacks become a minor operational metric rather than a significant P&L line item.
How does this calculator relate to Productiv's services?
Productiv's 3PL and fulfillment services include the operational infrastructure that drives chargeback prevention: pre-wired EDI connections for 60+ retailers, automated ASN validation, pre-built UCC-128 label libraries, routing guide compliance monitoring, and real-time SLA dashboards. The calculator models the financial impact of moving from a typical chargeback rate to one achieved with proper compliance infrastructure.
What should I do if my chargeback costs are higher than expected?
First, categorize your chargebacks by type (OTIF, ASN, labeling, routing guide, shortage) and by retailer. This reveals which failures are driving the majority of costs. Then evaluate whether your current 3PL has the compliance infrastructure for your specific retailers — EDI connections, label templates, ASN configurations, and routing guide specs. Often, high chargeback rates are a configuration problem that can be fixed during a structured onboarding to a compliance-focused 3PL.
Related Resources
How to Prevent Retail Chargebacks
The complete guide to preventing retail chargebacks across all major retailers.
Chargeback Dispute & Recovery
How to dispute invalid chargebacks with proper documentation and systematic processes.
3PL Compliance Checklist
The questions every brand should ask when evaluating a 3PL's retail compliance capabilities.
EDI & Retail Compliance Services
Full EDI transaction support, pre-wired retailer connections, and routing guide compliance for 60+ retailers.