What is the RTO Automations?
Shopflo’s RTO Automation allows merchants to automatically block or restrict COD orders based on predefined risk criteria.
This helps prevent fraudulent orders, reduce shipping costs, and improve conversion quality by focusing on genuine buyers.
Why RTO Prevention Matters?
Return to Origin (RTO) is a silent profit killer. High COD failures, fake orders, and manual verification are driving up costs and hurting growth. But with the right pre-order and post-order intelligence, you can reduce fraud, save shipping costs, and optimize conversions—without impacting real customers.
How RTO Automations Work?
🔍 Step 1: Proactively Block High-Risk Orders → Shopflo Smart Automations
Prevent fraudulent or high-RTO orders before they enter your system.
Shopflo Smart Templates
Use Shopflo Network Intelligence
✅ Key Capabilities:
1️⃣ Block COD for High-Risk Customers
Customers with a history of RTO can be identified and restricted from placing COD orders.
Example: A user previously placed 5 COD orders and returned 4. The system automatically blocks COD for their future orders, forcing them to use prepaid.
2️⃣ Enable Partial COD for Risky Pincodes
Certain regions have high COD return rates. Instead of blocking all COD orders, merchants can allow only Partial COD (e.g., ₹200 advance, rest on delivery).
Example: If a brand sees 40% RTO in Tier-3 cities, they can require a ₹100-₹500 deposit before confirming COD orders.
3️⃣ Restrict COD for Suspicious UTMs & Traffic Sources
Fake orders often come from spammy traffic sources, giveaway campaigns, or bot activity. By tracking UTMs, merchants can limit COD availability for these users.
Example: A brand running a Facebook giveaway gets a surge in orders from a viral post. Instead of allowing COD on all, the system flags and limits COD orders only to verified users.
4️⃣ Block COD for Fraud-Prone Pincodes
Certain pincodes have excessive RTO rates due to known fraud patterns. Merchants can automatically disable COD in these regions.
Example: If a small town has a 70% RTO rate, all COD orders from that pincode can be blocked automatically.
💡 The Impact of Step 1:
✔️ Stops fraud before it happens—saving time and money.
✔️ Improves conversion quality—real customers can still place orders.
✔️ Optimizes marketing spend—paid ads target only genuine buyers.
🎯 Step 2: Automate RTO Risk Analysis Post-Order → Shopflo RTO Risk Scoring
Once an order is placed, it’s critical to verify and manage high-risk orders efficiently.
View RTO score against each COD order
Control Risk threshold and personalise your brand
✅ Key Capabilities:
🔹 Assign Risk Tags to COD Orders (High / Medium / Low)
Orders are automatically classified based on multiple factors like customer history, pincode, order value, and suspicious behavior.
Example: A user placing an order for ₹5,000 COD in a fraud-heavy area gets a High-Risk tag, while a repeat customer with a prepaid order is tagged Low-Risk.
🔹 Centralized Dashboard for Risk Management
Merchants can filter orders by risk level, focusing only on verifying the most critical ones.
✅ Smart Actions to Reduce RTO Post-Order:
1️⃣ OTP Confirmation for High-Risk Orders
High-risk orders trigger an instant OTP verification, ensuring the user is genuine before shipping.
Example: A first-time customer ordering an expensive item via COD must confirm their order via OTP before it moves to fulfillment.
2️⃣ Call/WhatsApp Verification for Risky Orders
Orders tagged as High-Risk can trigger an automated WhatsApp message or a call center confirmation before being shipped.
Example: A customer placing 3 orders within 10 minutes gets a WhatsApp prompt for confirmation before shipping.
3️⃣ COD to Prepaid Conversion for High-Risk Orders
Instead of outright blocking COD, merchants can ask high-risk customers to pay a portion upfront before shipping.
Example: A user ordering ₹10,000 worth of products via COD is prompted to pay ₹1,000 upfront to proceed.
4️⃣ Risk Tags Sent to Shopify for Future Automation
Once risk-tagged, Shopify can use these insights to automate future actions—such as excluding high-RTO users from COD in their next purchase.
Example: A user tagged High-Risk today will see only prepaid options in their next visit automatically.
💡 The Impact of Step 2:
✔️ Reduces unnecessary shipping costs—bad orders don’t get shipped.
✔️ Optimizes logistics—only real, confirmed orders go out.
✔️ Increases prepaid adoption—converting high-risk COD to upfront payments.
How to setup Automations
Setup Video
Step-by-Step Guide
Detailed Guide
Detailed Guide
Step 1: Start by understanding the Automations feature. This feature allows you to control different flows on your checkout to cater to different types of customers.
Step 2: Create an automation. You have the option to use certain templates if they are RTO centric or start from scratch by clicking on create new.
Step 3: Enter the name and description of your automation. For example, if you want to create an automation to block cash on delivery (COD), name it accordingly.
Step 4: Choose the payment methods you want to hide. For instance, you might want to hide cash on delivery.
Step 5: Click on save and continue.
Step 6: Decide if you want no conditions on cart for this particular automation or if you want this automation for a particular order amount or a specific product in your catalog. For example, we select no conditions for this guide.
Step 7: Configure customer eligibility. Shop Flow offers multiple rules to configure an automation. You can choose this automation for all customers, first time customers, or for customers whose lifetime order count is a certain number.
For example we will be creating customer eligibility using the PIN code RTO risk.
💡 PIN code RTO risk and Customer RTO risk are powered by Shopflo Intelligence.
Shopflo Intelligence calculates an RTO risk score for each of your orders, based on data from Shopflo’s network of 750 brands, ensuring accurate and reliable risk assessments.
Step 8: Save and schedule your automation.
Step 9: Activate your automation to make it live on your checkout. Go to View Automations and activate your automation.
Now, you're ready to start controlling the COD orders on your checkout and start reducing your RTO.
Frequently Asked Questions (FAQs)
What happens in case of two active automations? How are conflicts handled?
What happens in case of two active automations? How are conflicts handled?
If two or more active automations conflict, the system follows an OR condition logic:
If any automation requires COD to be blocked, COD will be blocked — even if other automations allow it.
This rule also applies if a shipping rate blocks COD while an automation allows it — COD will still be blocked.
In short, blocking COD always takes priority when there’s a conflict.
Example:
Automation 1: Allows COD for orders under ₹1,000.
Automation 2: Allows COD for customers from Delhi.
Automation 3: Blocks COD for orders from high-risk pincodes.
Result: If an order is under ₹1,000, from Delhi, but falls under a high-risk pincode, COD will be blocked because at least one rule requires it
How accurate is the risk-scoring model?
How accurate is the risk-scoring model?
The model continuously improves by analyzing order patterns, ensuring accuracy improves over time. For best results we suggest sharing previous RTO data of atleast 3 months orders with us to get better results
How does the system determine if a customer's risk score?
How does the system determine if a customer's risk score?
RTO risk of an order is powered by Shopflo’s ML model which takes into consideration more than 41 parameters (like order details, user behaviour, address quality, etc.)
A risk score (between 0 to 100) is generated for every order and default thresholds are set for scoring:
High risk → score >= 60
Medium risk → 60 > score >=20
Low risk → score < 20
Majority risk scoring is based on factors such as:
Customer payment history across Shopflo Network (e.g., frequent COD orders)
Customer RTO/cancellation history across Shopflo Network (e.g., frequency of RTOs and cancellations)
Pincode risk levels across Shopflo Network (areas with known fraud patterns)
Suspicious behavior (e.g., Phone number attached to suspicious data
Can I customize what criteria determine risk levels?
Can I customize what criteria determine risk levels?
You CANNOT customise factors which determine risk. But you can configure risk thresholds and adjust scoring parameters to fit your brand’s needs.
How is Pincode risk calculated?
How is Pincode risk calculated?
Pincode risk is determined based on the historical behavior of orders associated with that specific pincode. The risk score is influenced by key factors such as:
Deliverability Rate: The percentage of successful orders delivered to the pincode. A low success rate may indicate issues like poor logistics support or unreliable recipients.
RTO/Cancellation Rate: The frequency of orders from that pincode that result in Return to Origin (RTO) or cancellations. Higher RTO rates increase the pincode’s risk score.
By analyzing these factors, Shopflo’s system identifies high-risk pincodes where COD failures are more common, allowing merchants to take proactive measures such as blocking COD, enabling Partial COD, or adding extra verification steps.
What happens when COD is blocked for a customer?
What happens when COD is blocked for a customer?
When COD is blocked for a customer, the system clearly indicates why COD is unavailable based on the specific condition:
Due to Discounts/Rewards:
COD Option: Greyed out and shown as unavailable.
Message Displayed: “Please remove [Discount Name] or [Reward Name] to enable COD.”
Due to Cart Conditions:
COD Option: Greyed out and shown as unavailable.
Message Displayed: “Please add [Required Item/Amount] to your cart or remove [Restricted Item] to enable COD.”
Due to Customer Eligibility:
COD Option: Greyed out and shown as unavailable.
Message Displayed: No specific message — COD will simply appear as unavailable.
This approach ensures customers understand why COD isn’t available and provides clear steps to resolve the issue where applicable.
What happens when COD is blocked but Split COD is visible?
What happens when COD is blocked but Split COD is visible?
You can adjust risk tagging thresholds during promotions to reduce false positives while still maintaining fraud protection.
Why is a repeat customer tagged as high risk?
Why is a repeat customer tagged as high risk?
RTO risk of an order is powered by Shopflo’s ML model which takes into consideration more than 41 parameters (like order details, user behaviour, address quality, etc.)
A repeat customer might have a RTO or pincode history in Shopflo Network database. Majority risk scoring is based on factors such as:
Customer payment history across Shopflo Network (e.g., frequent COD orders)
Customer RTO/cancellation history across Shopflo Network (e.g., frequency of RTOs and cancellations)
Pincode risk levels across Shopflo Network (areas with known fraud patterns)
Suspicious behavior (e.g., Phone number attached to suspicious data)
💡Tip
Need more help? Reach out to us at support@shopflo.com