Returns are an unavoidable part of retail. Statistics show that one in three purchases ends up getting returned. The reasons differ, but for sure, they’re not always because the seller is at fault.

There are various ways to handle returns. One of them is by sending a return shipping label to your customer. There are two types—prepaid and pay-on-use—each with a different purpose. However, between the two, startup owners will find that pay-on-use return labels have more advantages over time.


In this article, we talk about sending prepaid and pay-on-use return labels for the three major US carriers, USPS, FedEx and UPS. We shall discuss how the two methods work and why the pay-on-use type benefits you more in the long run.

But first, we need to understand…

What Is a Return Shipping Label?

A return shipping label is a pre-addressed postage label that customers can use for returning purchases to a seller. Here, the “ship to” and “ship from” addresses swap. If you’re the seller, your business address is the parcel’s destination.

The standard size of a return shipping label is the same as that of an outbound shipping label: 4”x 6”. At enKo Products, our clients find that our 4” x 6” fanfold labels are the most economical for creating professional-looking shipping labels. You can print return shipping labels on a wide thermal printer, such as a Rollo or Dymo 4XL.

You can send a return shipping label in two ways:

  • Paying for one only when you need it, then sending it to the customer. This is a prepaid return shipping label.
  • Sending them a pay-on-use return label together with their order even before they consider a return. Customers appreciate this gesture a lot! And you pay for it only when they actually return the product.

As your business grows, you will find that sending a pay-on-use return label is advantageous strategically and financially. It psychologically influences customers to buy more from you, establishing your brand as one that truly cares. We explain this some more below.

Take your branding to the next level! Buy High-Quality 4 x 6 Fanfold Labels at enKo Products.

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Why Should You Consider Sending a Return Shipping Label to Your Customer?

Picture this: a buyer finds that the shirt that they bought from you does not fit. They want it replaced, not refunded. What should you do?

In cases like this, you are lucky that the customer is not asking for a refund. If you built your shipping fees into your selling price, you could at least keep some of the profit. So it’s best to accommodate the replacement request.

How should you proceed?

You have the following options:

  • You let the customer pay for shipping both ways.
  • You send them a return shipping label and pay for the replacement’s delivery as well.
  • You make alternative return arrangements.

Customers usually find the first option inconvenient. If they don’t get their purchase replaced, they will end up dissatisfied with your service. If they decide to continue, the additional costs will also bring discontent. You may offer to reimburse them for the shipment. However, the wrong choice of carrier and service, as well as potential address misspellings, can eat up your profit in the end.

On the other hand, sending them a shipping label lets you control the costs and reduce shipping label errors. One way to do it is to email them a prepaid return label, which you can generate as needed. The other is to anticipate a return early on from every client and send a pay-on-use return shipping label with every delivery.

You may think that sending pay-on-use labels is a little radical, but business giants don’t think so. As-needed prepaid return labels may seem less expensive at first. However, they don’t do as much for marketing as does sending a pay-on-use label outright.

Other ways to settle returns are:

  • Refunding
  • Having the customer visit your store for the exchange
  • Going over to your customer’s place for the swap, etc.

With refunds, you lose money to shipping. Meanwhile, the other methods work only under special circumstances.

Of these approaches, you will find that the best one is to send a pay-on-use return shipping label along with each delivery.

An outbound shipping label and its corresponding return label

How Do You Send a Prepaid Return Shipping Label to a Customer?

That depends on where you plan to pay for online postage.

If you’re selling through platforms like Amazon and eBay, you may generate your return shipping labels on-site. But this is not easy to do for some purchases, like those that do not fit standard shipping boxes. Additionally, for sites like PayPal, creating a return label is not as straightforward. In these cases, you may have to visit your carrier’s office or create your prepaid return labels using an online postage app.

Of course, it’s more convenient to just pay for postage online than drive all the way to your carrier. Here, we describe the steps for sending prepaid return labels with USPS, FedEx and UPS as carriers.

Learn More:

Sending a Prepaid Return Shipping Label via USPS

The Post Office lets you generate your shipping label online through two kinds of online postage providers. The first type requires monthly subscriptions and includes and Pitney Bowes. The second type does not require monthly fees. For now, only Pirate Ship belongs in this class.

On, you can create your prepaid USPS return shipping label by the following steps:

  1. On the main menu, go to the “History” tab.
  2. Click the order for which you are making the USPS return shipping label.
  3. On the right panel, click “Return Label.” This will open the “Return Label” window.  
  4. You will be asked for the kind of service you want and if you need insurance. The final price will depend on these. Type your choices and click “Continue.” You may choose or your own email to send the label online to your customer. Follow the other prompts and click “Send” after making your choice.

On Pirate Ship, you can generate your prepaid USPS return shipping label by the following steps:

  1. On the main menu, click “Create a Single Label.”
  2. Scroll down and look for “Extra Services.”
  3. To activate the return label feature, click “just let us know.”
  4. A chat box will open. Here, you can request to have the return label feature activated. Type “I would like to create return labels.” Processing can take a few minutes.
  5. Once activated, go back to “Extra Services” and click “Return Labels.”
  6. On the drop-down menu, select “Return Labels Only.”
  7. Click “Get Rates.”
  8. In the next window, you will be shown a list of USPS services. Choose the one you need and click “Buy Label.”
  9. Pirate Ship will generate your return label. From here, you may email the label’s PDF file or its link to your customer.

You must create USPS return labels within a few days from the purchase date of their respective outbound labels. They also have expiration dates. These periods vary with every online postage provider, so you must ask before signing up for a service.

Sending a Prepaid Return Shipping Label via FedEx

The following are the steps for creating a return label using the FedEx Ship Manager software:

  1. From the main menu, go to the “Prepare Shipment” tab.
  2. Click “Create Return Shipment.”
  3. Follow the prompts, then click “Ship.”

Unlike in USPS, FedEx return labels do not expire. It’s best to clarify your return window to your customers to prevent confusion.

Sending a Prepaid Return Shipping Label via UPS

Here’s how you can create UPS return labels online using UPS Internet Shipping:

  1. On the “Create a Shipment” page, click “Create a Return.”
  2. Follow the prompts for making a UPS return label.
  3. Click “View/Print.”
  4. From here, you may save the label as a PDF file and email it to your client.

UPS return labels do not expire, either, like their FedEx counterparts.

A purchase return can be a painful process if you’re not ready for it. But thriving businesses turn these potential mishaps into opportunities for retaining more clients. If you want to build your brand, handling returns with finesse is key. One way to do it is by including a pay-on-use return shipping label in each delivery.

A seller dealing with outbound and returned packages

How Can You Benefit from Sending a Pay-on-Use Return Shipping Label with Your Outbound Packages?

Many growing businesses use friendly return policies as a way of attracting more buyers. E-commerce prevents customers from examining a product more closely, which may also keep them from completing transactions. The promise of easy returns convinces more to take a risk on new products or sellers.

If you plan to implement a hassle-free return process, you must go all-out and send pay-on-use return labels. Here’s why:

Process Returns Quickly
Control Shipping Costs
Retain More Customers
Reduce Return Address Errors
Huge Potential Returns


Pay-on-Use Return Labels Let You Process Returns Quickly

With pay-on-use return labels, you simplify returns for you and your customers.

For your customers, they won’t be left scrambling about how to give you back an item. Just give them clear instructions about how to use the label and package the product. That should let them ship it back right away.

For you, it saves you time initiating the return process. You don’t have to go back and forth on each transaction, tracing, calculating and finding the best service class every time. You’ve already figured out everything from the start.


Pay-on-Use Return Shipping Labels Give You Control of the Shipping Costs

Non-business purchasers do not enjoy shipping discounts like small business owners do. If you let customers determine the return shipping method, you will give them control of its costs. It can be very expensive if the transaction involves an item exchange. You may end up paying the full price for overnight shipping in both directions. 

By sending a pay-on-use shipping label, you get to control the service class and fees. You can use your shipping discounts to get the speediest logistics at the best rates.


You Can Retain More Customers with Pay-on-Use Return Labels

Sending pay-on-use return labels with your deliveries gives customers a good impression of your business.

  • The practice lets customers know that you are confident about your products’ quality. This staves off return abuse rather than invite it.
  • Pay-on-use return labels convince them that you are customer-focused.
  • You open more opportunities for repeat transactions.

Returns are inevitable. But devoting more effort to customer retention and other marketing strategies lets you minimize their impact. Pay-on-use labels help you there as they encourage customers to buy from you again. 


Pay-on-Use Labels Let You Reduce Return Address Errors

These labels already have your business address printed on them correctly. You save your customers the hassle and the postal system a ton of headaches. You also ensure that the product will find its way back to the right place.


The Effort Costs Little, but the Potential Returns Are Huge

Growing businesses sign up for online postage services, which offer hefty discounts for frequent shipments. As an added benefit, they also let you send pay-on-use labels at no extra cost. You only pay for a shipment when a customer uses a return label. These labels are not used more than usual. But they do encourage more customers to buy more.

With pay-on-use labels, you spend mostly on 4” x 6” labels, each of which costs only a few cents. And when you buy them from enKo Products, you save even more!

With great savings and a brilliant marketing strategy, you can stay far ahead of the competition for a long time.

As-needed prepaid return labels are easy to create but harder to compensate for. In contrast, pay-for-use return labels pay for themselves over time. When you think about it, the latter’s effect is no different than other proactive marketing strategies at your disposal.

Need to Print Return Address Labels? Choose our 4” x 6” Dymo Compatible Shipping Labels!

Dymo 4XL Shipping Labels

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How Do You Send a Pay-on-Use Return Shipping Label to a Customer?

Again, it depends on which online postage provider you sign up with.

For Pirate Ship’s USPS pay-on-use labels, the steps are pretty much the same as when getting a prepaid return label. But instead of choosing “Return Labels Only,” select “Return Labels Included.” Also, instead of emailing your client, you will print the label and put it inside the outbound package. You have to sign up as a business owner to avail of their free pay-on-use labels.

To make USPS return labels on other sites, the process depends on the software used. For, here are the steps:

  1. On the main menu, click the “Mail” tab.
  2. Scroll down, and open the drop-down menu under “Return Label.”
  3. Choose “Return Service.”
  4. The site will display your return shipping label. You can print this on an enKo Products 4” x 6” label and put it in your outbound parcel.

Sites like Pitney Bowes can help you make FedEx and UPS return labels in addition to USPS-accepted ones. Again, the process depends on each site’s software. Generally, though, online postage apps are beginner-friendly. 

Pay-on-use USPS return labels expire after a few months. Those of FedEx and UPS do not have expiration dates. Check with your service provider for updates about these features.

Returning a Package


In summary, return shipping labels are pre-addressed shipping labels that facilitate easy purchase returns for customers. Compared to other methods, sending these labels lets you control a lot of factors that will otherwise complicate the return process.

There are two types of return labels available to sellers. The first is the prepaid type, which you can generate whenever you need one. The second is the pay-on-use type, which you include with every outbound package. Business owners can print pay-on-use labels for free and pay only for actual return shipments. Prepaid return labels look cheaper at first glance, but pay-on-use labels can boost your revenues and brand more in the long run.

Aside from their marketing advantages, pay-on-use labels let you process returns quickly, control costs and reduce mislabeled return packages. Sites like Pirate Ship, and Pitney Bowes let you create both prepaid and pay-on-use labels. USPS return labels expire after a few months, but those of FedEx and UPS can be used indefinitely.

Frequently Asked Questions

Shipping labels serve as identification to help describe and specify what’s inside a package. 

The main information in a shipping label includes: tracking number, package quantity, postal code, country, date, address, city and state area. It also includes the weight and validation of the package.

A return shipping label is a pre-addressed postage label that customers can use for returning purchases to a seller.

There are many ways on how to create your shipping labels. First, you need to know the required information in a shipping label. You also have to check the standard label sizes and type of printers to use in printing your shipping labels.


For step by step instruction on how to create and print your shipping labels using MS Word, MS Excel and Mac, you may check out this guide “Startup Business Tips: How To Create a Shipping Label”.

You can sign up as a business owner to avail of free pay-on-use labels.

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