Logistics Firms Deploy AI to Reduce Failed Deliveries and RTOs by Up to 20% for D2C Businesses

As per a Business Standard news report, logistics companies are using artificial intelligence to deal with failed deliveries and return-to-origin (RTO) shipments, which remain a cost issue for D2C and ecommerce businesses.  

The technology is being used for address checks, customer follow-ups, courier selection, and delivery operations. 

An RTO occurs when an order cannot be delivered because of an incorrect address, failed delivery attempts or customer refusal, following which the shipment is sent back to the seller. 

MyMuse Cuts NDR Resolution Time 

The report suggests that during January-March, intimate wellness startup MyMuse had nearly 30% of its orders marked as non-delivery reports (NDRs). Its customer support team was taking between 48 and 72 hours to resolve these cases. 

The company deployed Parth, an AI-powered voice agent developed by ClickPost, to handle NDR management. MyMuse said it is now resolving 80% of NDR cases within a day. 

ClickPost said brands using Parth have recorded a 15-20% reduction in RTO rates. The system is used to automate customer follow-ups after unsuccessful delivery attempts. 

Shiprocket's AI-Based Delivery Tools 

Shiprocket uses AI across checkout, courier allocation, and last-mile delivery. Its checkout system checks a customer's last successful delivery address before an order is placed, while its courier recommendation engine suggests a logistics partner. 

About 40% of sellers on the platform use the recommendation engine, according to the company. Customers are also notified before delivery and can reschedule if they are unavailable. 

Shiprocket said these AI-based interventions have helped bring down RTOs by nearly 20% across its platform. 

Unicommerce and Zippee Report Similar Trends 

Unicommerce's analysis of this year's summer sales showed RTO rates at 17%, compared with nearly 25% during the same period last year. The company attributed the change to AI-based delivery planning and customer communication. 

Brands using its ShipSense AI agent also reported higher delivery success rates. DrVeda improved from 79% to 85%, Krvvy from 89% to 93%, and Be Clinical from 65% to 71%. 

Zippee has deployed AI tools for address verification, rider performance and service monitoring. It reported a 10-15% reduction in RTOs and a 5-8% improvement in first-attempt delivery success. 

Read More: India Job Postings Report 1.2% Growth in July 2026, Healthcare Sector Shows Gains! 

Conclusion 

The reported figures show AI being used across different stages of the delivery process. Logistics firms are applying it mainly to reduce failed deliveries, manage returns, and cut the amount of manual work involved in these operations. 

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