Analysis from AI-powered courier claims platform Claimit has found that UK retailers are missing out on up to £2.1 billion a year in unclaimed refunds for lost and damaged parcels – a hidden cost that is quietly eroding profit margins across the sector.
More than 4.2 billion parcels were delivered in 2024. With 1 per cent going missing or arriving damaged, that is equal to 42 million packages in total. Yet many retailers lack the specialist knowledge, time or resource to manage claims effectively, deterred by opaque processes that make recovery time-consuming and inefficient.
The result is that billions of pounds in recoverable claims are being written off by some of the country’s leading retail brands at a time when the retail sector can least afford it. ONS data shows UK retail sales grew by just 0.2 per cent in Q2 2025, while logistics costs continue to climb. With operating margins squeezed, this pool of unclaimed revenue represents a significant and overlooked opportunity.
Andy Watson, co-founder of Claimit, says: “Retailers have learned to live with a structural inefficiency that simply shouldn’t exist. Every unclaimed parcel refund is margin left on the table. For some brands, that’s the difference between breaking even and falling into the red. At a time when every cost is under scrutiny, recovering that lost revenue protects retailers’ margins and helps prevent those losses being passed on to consumers through higher prices or delivery fees.”
Claimit found that over 40 per cent of UK retailers never claim for lost or damaged shipments, despite the potential to recoup millions each year. For those that do, success rates are often low. In a review of data from retail brands across the ecosystem, data has shown that automation can increase claim success from 13 per cent to over 70 per cent and cut manual processing time by as much as 80 per cent.
For many retailers, the gap is cultural as well as financial. Claims are handled manually by customer service and operations teams, with limited visibility into courier success rates or invoice discrepancies. Each missed claim represents lost revenue and significant time spent navigating multiple carrier systems instead of serving customers.
Andy Watson continues: “The process has been made so cumbersome for retailers through antiquated workflows that many simply give up. It’s astonishing how many major ecommerce brands are either writing off millions each year or deploying team hours to manage a process that can more efficiently and accurately be completed by advanced technologies.”
The issue comes amid wider scrutiny of delivery performance following Ofcom’s 2025 report into courier reliability and customer service. Claimit’s findings suggest that beyond consumer dissatisfaction, there is also a systemic economic cost to the inefficiencies built into the delivery ecosystem. For the first time, retailers can gain real-time visibility into losses, errors and courier performance issues that have historically been hidden across fragmented systems.
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