Accounting Average Order Value Calculator
Calculate your average order value from gross sales, discounts, refunds, and completed orders.
Overview
This Accounting Average Order Value Calculator estimates the net amount earned per completed order. Enter gross sales, discounts, refunds, and the number of completed orders for one consistent period to review your average order value and related sales measures.
How it works
Average order value (AOV) is calculated by dividing net sales by completed orders. Net sales equal gross sales less discounts and refunds. The calculator also shows gross AOV, which uses sales before reductions, and the proportion of gross sales reduced by discounts and refunds. Using a consistent reporting period is important because differing dates can distort the result.
How to use this calculator
- 1Enter gross sales for your chosen reporting period.
- 2Add the total value of discounts and promotional reductions.
- 3Enter refunds and return credits issued in that same period.
- 4Enter the number of completed orders.
- 5Review net average order value alongside net sales and the discount and refund rate.
Example Calculation
Gross sales
$50,000
Discounts and promotions
$5,000
Refunds and returns
$2,000
Completed orders
1000
Average order value
$43.00
Net sales are $43,000 and the net average order value is $43.00 per completed order. The gross average order value is $50.00, while discounts and refunds represent 14.00% of gross sales.
Frequently asked questions
What is average order value?
Average order value is the average revenue generated from each customer order during a reporting period. It is commonly calculated as sales divided by the number of orders.
Should refunds be included in average order value?
For net AOV, refunds are normally deducted because they reduce retained revenue. You can compare net AOV with gross AOV to see the effect of discounts and refunds.
Should cancelled orders be included?
Usually, exclude orders that were cancelled before completion. If an order was completed and later refunded, include the order count and enter the refund amount so the calculation reflects the revenue reduction.
Are taxes and shipping included in AOV?
That depends on your reporting method. For meaningful comparisons, apply the same treatment of taxes and shipping in every period and make sure the sales amounts are consistent.
How can I use AOV to compare periods?
Calculate AOV using the same order definition and revenue treatment for each period. Compare it with order volume, refund rates, discounts, and product mix to understand what changed.
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Assumptions and warnings
Assumptions
- All amounts and order counts cover the same reporting period.
- Completed orders are counted once, including orders that were later partially or fully refunded if their refund value is included.
- Net sales are calculated as gross sales minus discounts and refunds.
- Shipping charges, taxes, marketplace fees, and payment-processing fees are excluded unless included in the sales figures you enter.
Warnings
- This calculator provides an accounting estimate only; use your organisation's reporting policy to determine how sales, returns, taxes, and fees should be recorded.