Warranty Return Rate Calculator

Work out warranty return rate instantly with clear inputs, formula shown and shareable results.

About Warranty Return Rate Calculator

Warranty return rate is returns as a percentage of units shipped over the warranty term. Expressing it per million units and per month of exposure makes cohorts of different volumes and warranty lengths comparable, which is essential when a warranty period changes.

Formulas

Return rate

Return rate % = returns x 100 / units shipped; PPM = returns / shipped x 1,000,000

Cost

Warranty cost = returns x cost per return

Worked example

With the default values below, Warranty Return Rate Calculator returns Warranty Return Rate of 1.2083%. Change any input above and every figure here is recalculated in your browser.

Inputs used

Units Shippedminimum 0.01: 120,000
Warranty Returnsminimum 0: 1,450
Warranty Periodminimum 0.01 months: 24 months
Cost Per Returnminimum 0: 2,400

Results

Warranty Return Rate: 1.2083%
Returns Per Million: 12,083
Average Monthly Return Rate: 0.05035%
Total Warranty Cost: $3,480,000.00

Step by step

1Values used
2Return rate
3Cost
4Warranty Return Rate= 1.2083
5Returns Per Million= 12,083
6Average Monthly Return Rate= 0.05035
7Total Warranty Cost= 3,480,000.00

Assumptions and limits

The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
In particular, this calculator does not take inflation or tax into account.
Figures are rounded for display to 5 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

Why compare cohorts rather than calendar periods?

Returns arrive months after shipment. A calendar-month return rate mixes cohorts and hides whether the product is getting better or worse. Track returns by month of manufacture instead.

What is included in cost per return?

Replacement or repair cost, freight both ways, diagnosis labour, administration and any goodwill credit. Indirect brand damage is real but usually excluded from the accounting figure.