Guide · 4 min read
Why Your Reorder Number Might Be Too High (And It’s Not Your Fault)
Say you sell hoodies. Last month, 100 units of your best-seller sold, according to your inventory tool. Solid number. You order accordingly.
Here’s the catch: 25 of those 100 came back as returns. So really, only 75 sold and stayed sold.
But your reorder number was based on 100.
Where this comes from
Most sales data has two versions of “how many units sold”:
- Gross: everything that was ordered, including anything that got returned afterward
- Net: only what actually stayed sold, after returns are subtracted
A lot of inventory tools quietly use the gross number. It’s the simpler one to grab, and on a low-return product (electronics, home goods), the difference is small enough that nobody notices.
On anything with real return rates — clothing, shoes, anything sized or tried-on — it adds up fast. A 20-30% return rate isn’t unusual in fashion. That means your “sales velocity” is 20-30% higher than what actually stuck.
Higher velocity → higher reorder number → more stock sitting on a shelf, paid for, not moving.
It’s not as simple as just subtracting returns, though
Here’s the part that’s easy to get wrong in the other direction: not every return means the product is back in stock and available again.
- A shirt that comes back clean and resellable → back on the shelf, don’t count it as a real sale
- A damaged item, an opened item, or a “just keep it, here’s your refund” case → the unit is gone. It was really consumed, even though the money went back.
If you just subtract every return, you swing too far the other way — undercounting demand, which pushes toward under-ordering. And under-ordering is worse than over-ordering: a stockout doesn’t just cost you that sale, it drags down your average sales pace for next time too, since the zero-stock days look like “the product stopped selling.” That makes the next reorder too small as well, and the problem repeats.
The honest version needs one more distinction: was the returned unit actually restocked and resellable, or not? Only the truly resellable returns should get subtracted back out.
How this shows up in practice
This is one of the things we check for in Invocast: units that were refunded and genuinely didn’t come back to stock aren’t counted as sales going forward, so the reorder number reflects what actually stayed sold — not what was ordered and returned.
The takeaway
If your reorder numbers have felt consistently too high — stock sitting around longer than it should, especially on anything with sizes or fit — this is one of the most common, least visible reasons why. It’s not bad luck or bad guessing. It’s often just a sales number that never subtracted the returns in the first place.
A 5-minute way to check your own numbers: pick a return-heavy product, and compare what your tool says it sold last month against your Shopify sales report for the same period (Shopify’s own reports are already net of returns). If your tool’s number is noticeably higher, this is likely why.
We build Invocast, an inventory forecasting app for Shopify stores. Getting the “real” sales number right — not just the gross one — is one of the things it’s built around.