Accounting Average Order Value (Annual) Calculator
Calculate your annual average order value using gross sales, refunds and the total number of customer orders.
Overview
This annual average order value calculator estimates the net amount earned per completed customer order. Enter annual gross sales, refunds or credits, and completed orders to see net AOV, gross AOV and the proportion of sales refunded.
How it works
Net annual sales are calculated by subtracting refunds and credits from gross sales. The annual average order value is then calculated as net annual sales divided by completed orders. Gross average order value uses gross sales instead, so comparing the two helps show how refunds and credits affect revenue per order.
How to use this calculator
- 1Enter gross sales for a single 12-month period.
- 2Add refunds, returns and customer credits recorded for that same period.
- 3Enter the number of completed customer orders.
- 4Review net average order value and compare it with gross average order value.
- 5Use the same accounting basis each year when tracking changes.
Example Calculation
Annual gross sales
$250,000
Annual refunds and credits
$15,000
Completed orders
5000
Annual average order value
$47.00
With gross sales of 250,000, refunds of 15,000 and 5,000 completed orders, net annual sales are 235,000 and annual average order value is 47.00 per order.
Frequently asked questions
What is annual average order value?
Annual average order value, often called AOV, is the average revenue generated by each completed customer order over a 12-month period.
How do you calculate average order value for a year?
Divide annual sales revenue by the number of completed orders. For net AOV, subtract refunds and credits from gross sales before dividing.
Should refunds be included in average order value?
For a net revenue view, subtract refunds, returns and credits from gross sales. Tracking gross AOV separately can also help identify the effect of refunds.
Should cancelled orders be included in the order count?
Usually no. Include completed orders that correspond to the revenue figures used in the calculation, and apply the same method consistently.
Is AOV the same as revenue per customer?
No. AOV measures revenue per order, while revenue per customer measures revenue per unique customer. A customer may place more than one order.
Why can annual AOV differ from monthly AOV averages?
A simple average of monthly AOV figures may not match annual AOV because months can have very different order volumes. Annual AOV is best calculated from total annual sales and total annual orders.
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Assumptions and warnings
Assumptions
- All figures relate to the same 12-month accounting period.
- Completed orders are counted once and match the sales revenue entered.
- Refunds and credits reduce revenue but do not reduce the completed-order count.
- Results are estimates and do not account for taxes, shipping income, discounts, chargebacks or accounting adjustments unless included in your figures.
Warnings
- This calculator provides an estimate for business analysis and is not accounting, tax or financial advice.
- Use consistent revenue recognition and order-counting methods when comparing periods.