The 12% commission rate factors in an average returns rate, meaning that commission is charged on all orders irrespective of returns/cancellations that are made after the transaction is complete.
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We are fronting the ad spend with our capital and taking on risk. If you were funding Google ads with your own money Google would also not refund your ad spend.
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Additionally, as a result of the original sale, the Merchant also gains the contact details of the customer so they can re-market to the customer, so even if an item is returned/cancelled, there may still intrinsic value to the transaction.

If you are facing high returns and refunds from orders we generate, in some instances we may be able to agree to lower the commission rate to compensate. Please note that if the commission rate is lowered, we'll have less room between our ad spend and commission earnings to break-even, which will mean we reduce our ad spend. This will produce less order volume than you are currently experiencing.

We recommend you look at the overall picture when assessing the orders and revenue we generate vs the commission paid - the refunds & returns rate.