7 Ways to Reduce Failed Deliveries and Shipping Returns

Failed deliveries are one of the most expensive problems in e-commerce. Every package that can't be delivered costs you money in return shipping, customer service time, and potential refunds. For growing businesses, these costs add up quickly.

The good news? Most delivery failures are preventable. With the right systems in place, you can dramatically reduce failed shipments and improve customer satisfaction.

Here are seven proven strategies to reduce failed deliveries and protect your profit margins.

1Validate Addresses at Checkout

Address errors are the leading cause of failed deliveries. Common issues include typos, missing apartment numbers, outdated addresses, and restricted delivery locations like PO Boxes when you're using carriers that can't deliver there.

Solution: Implement real-time address validation during checkout. This can include:

• Autocomplete suggestions as customers type
• Verification against postal databases
• Blocking addresses your carriers can't deliver to
• Prompts to confirm or correct questionable addresses

For Shopify stores, apps like No PO Box can automatically block addresses that will cause delivery problems.

2Send Proactive Shipping Notifications

Customers who know when to expect their package are more likely to be available to receive it. Failed deliveries often happen simply because no one was home.

Solution: Set up automated notifications at key points:

• Order confirmation with estimated delivery date
• Shipment confirmation with tracking link
• Out for delivery alert on delivery day
• Delivery confirmation or "we missed you" notice

SMS notifications tend to have higher engagement rates than email for time-sensitive delivery updates.

3Offer Delivery Options and Flexibility

Not every customer can receive packages at their home address during business hours. Giving customers options reduces the chance of failed delivery attempts.

Solution: Consider offering:

• Ship to a different address (work, friend, family)
• Carrier pickup points or lockers
• Scheduled delivery windows
• Authority to leave without signature (for appropriate products)
• Local pickup from your store or warehouse

4Use Appropriate Packaging

Damaged packages often get returned to sender or refused by customers. Packaging that's too large can also cause delivery issues with mailboxes or lockers.

Solution: Match packaging to your products:

• Use right-sized boxes to minimize movement and damage
• Include adequate cushioning for fragile items
• Use weather-resistant packaging for items sensitive to moisture
• Consider mailbox-compatible packaging for small items
• Clearly label fragile or orientation-sensitive packages

5Choose the Right Carrier for Each Shipment

Different carriers have different strengths, coverage areas, and delivery capabilities. Using the wrong carrier for a destination or product type increases failure risk.

Solution: Match carriers to shipment characteristics:

• USPS: Best for small packages, PO Boxes, and rural areas
• UPS/FedEx: Best for business addresses and time-sensitive deliveries
• Regional carriers: Often provide better coverage in specific areas
• Hybrid services: Combine cost efficiency with broad coverage

6Handle International Shipments Carefully

International deliveries face additional challenges: customs delays, import duties, and inconsistent address formats. Failed international deliveries are particularly expensive due to higher return shipping costs.

Solution: Take extra precautions for international orders:

• Clearly display shipping restrictions before checkout
• Collect phone numbers for customs contact purposes
• Include accurate customs declarations
• Inform customers about potential duties and taxes
• Consider DDP (Delivered Duty Paid) options
• Validate international addresses against local postal databases

7Monitor and Learn from Delivery Data

You can't improve what you don't measure. Tracking your delivery performance helps identify patterns and problem areas.

Solution: Regularly analyze your shipping data:

• Track failed delivery rates by carrier, region, and product type
• Identify repeat offender addresses or customer accounts
• Look for seasonal patterns in delivery failures
• Calculate the true cost of failed deliveries including hidden expenses
• Set benchmarks and track improvement over time

Many shipping platforms provide analytics dashboards, or you can export data to a spreadsheet for custom analysis.

The ROI of Preventing Failed Deliveries

Let's put this in perspective. If your store ships 1,000 orders per month with a 5% failed delivery rate, that's 50 failed deliveries. At an average cost of $17.50 per failure (return shipping + handling + customer service), you're losing $875 per month—over $10,000 per year.

Cutting that failure rate in half saves you $5,000+ annually, not counting the harder-to-measure benefits like improved customer satisfaction and reviews.

Investing in prevention—whether through better checkout validation, improved packaging, or smarter carrier selection—almost always pays for itself many times over.

Conclusion

Failed deliveries are frustrating for everyone involved: you lose money, customers lose patience, and products sit in shipping limbo. But with a proactive approach, most delivery failures are completely preventable.

Start with the lowest-hanging fruit—address validation at checkout—and work your way through these strategies based on what's causing the most problems in your business. Small improvements compound over time, turning your shipping operation into a competitive advantage rather than a cost center.