FBA fee reimbursements are when you get a refund for a Fulfilment by Amazon fee that you shouldn't have had to pay according to their terms of service.
Common Reasons for FBA Reimbursements
1. Lost and Missing Inventory
Lost inventory can occur during the shipping phase or possibly once received into the Amazon FBA warehouse. Inventory can be accidentally placed to other Amazon seller accounts, or incorrect barcodes can affect where your inventory ends up. Luckily, Amazon’s inventory reconciliation reports will allow you to view all details pertaining to your inventory for the last 18 months.
2. Damaged Inventory
FBA-housed inventory can be damaged by Amazon employees when they are fulfilling orders, or by carriers who are delivering customer returns back to the Amazon warehouse. It’s not just within Amazon that damages happen; it’s also enroute to your customer where damages can occur given the expedited shipping the platform offers. Because of the volume of products, this is another common category for reimbursements. Thousands of products and returns are handled every day and accidents can often happen. The damaged inventory report will help you break down your damages and can be found in your seller central account under ‘Damaged Inventory’ Report.
3. Customer Returned Amazon FBA Inventory
Of all the Amazon FBA reimbursement categories, this one is the most common. With many returns being processed every day, problems are inevitable. Return reasons include:
i) Restocking fees – A customer returns an item later than 30 days and Amazon doesn’t award you the 20% restocking fee.
ii) Customer refunded too much – The customer could be refunded the wrong price, or they could be refunded for two units when they only returned one.
iii) Customer replacements – Amazon sends the customer a replacement but the customer doesn’t return the original.
iv) Return product not received for refund – The customer received the correct refund amount but they did not actually return the product.
v) Returned inventory errors – The wrong item gets returned and scanned into your inventory.
vi) Missing order credits – A customer receives a refund but you didn’t get the amount credited back to your account.
vii) Return product received unsellable – A returned product could be received unsellable, which you should be reimbursed by Amazon for.
4. Destroyed and Disposed of Amazon FBA Inventory
Without your explicit approval, Amazon may destroy inventory. This frequently occurs when a customer returns an item that has been damaged and is no longer sellable. When this happens, Amazon is supposed to provide you a refund for the item's value. However, the refund may not always be received. Not only must you look for problems, but you must also ensure that refunds are completed when they should be.
5. Overcharges of FBA Fees
Various Amazon FBA fees, such as storage fees, commission fees, shipping fees, and long-term storage fees, might affect your Amazon FBA operation. Sometimes, you’re overcharged the wrong fee. You can be charged shipping fees for a product that is twice as heavy. Or you could be charged the 15% commission fee in the books category for an item in the consumer electronics category, which is supposed to be 8%. Overcharges like these can quickly mount up to substantial reimbursements, especially if they last for weeks or months.
6. Order Quantity Errors
There can also be issues with processing order quantities. A customer can receive three items when they only paid for two. Most customers won’t ship back the extra. They’ll just enjoy their luck. When this happens, Amazon may not discover the error on its own. You’ll need to detect discrepancies in your inventory and order details and put claims to get reimbursed.
It's critical to safeguard your account and your hard-earned gains. Some issues will be automatically reimbursed by Amazon FBA, however they will not catch all of their own errors. That's why you'll need the right combination of inventory and order monitoring software, as well as manual account audits.
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