As an amazon seller and consultant for Sellers, the issue of FBA refunds never ceases to amaze me. So much so that I have even come to think that Amazon Logistics is financed, in part, with the money that remains in limbo from these reimbursements.
I have customers who are owed $500,000 by Amazon and we "only" sell in Europe. It's crazy to think that all that money is yours and that if you don't know how to claim it, Amazon will unfairly take it.
Amazon FBA Reimbursements are a fundamental part of selling on the world's largest online marketplace. When mistakes made by Amazon lead to losses, sellers (of course!) have the right to claim that money back.
FBA (Fulfillment By Amazon) is Amazon's own logistics platform, but it can come with errors and discrepancies. These errors can happen in inventory reconciliation, reporting, packing slips, inventories, listings, and more. To maximize your profits and protect your capital, an understanding of Amazon FBA reimbursements is essential.
My article will try to give you an overview + some tools on Amazon FBA reimbursements, explain how to determine their value, and outline how to file a claim independently or with the help of an external service. Let’s go!
What Is a FBA Reimbursement?
Amazon FBA reimbursements are payments made by Amazon to sellers for mistakes made by Amazon Logistics / Fulfillment Centers / Warehouses.
These reimbursements are available when Amazon loses or damages items in their care, or fails to meet agreed-upon terms. Which terms? of course, those on the fine print.
Types of FBA Reimbursements
I have covered this topic exhaustively on my website, if you want to take a look at it, the article is called Amazon FBA reimbursements and you’ll find every type of FBA reimbursement (more than 70!).
There are several different types of FBA reimbursements available to sellers. The main ones are::
- Lost Inventory Reimbursement: When Amazon loses a product, they will reimburse the seller for the cost of the item plus applicable taxes and shipping fees.
- Damaged Inventory Reimbursement: If Amazon damages an item, sellers can receive reimbursement for the cost of the item plus applicable taxes and shipping fees.
- Return Processing Fee Reimbursement: Sellers can receive reimbursement for their return processing fees when Amazon refunds customers who return products.
- Weight Handling Fee Reimbursement: When Amazon makes mistakes in their weight handling fees, sellers can receive reimbursement for the difference in the fees.
- Long-Term Storage Fees Reimbursement: Sellers can receive reimbursement for long-term storage fees if Amazon charges them incorrectly.
- Reverse Logistics Fee Reimbursement: Sellers can receive reimbursement for any incorrect reverse logistics fees charged by Amazon.
If you want to get familiar with those policies, read this PDF by Amazon.
This is also extensive to Vendors as well. Please meet Amazon chargebacks:
- Import Documents Late Delivery
- Import Shipment Late Booking
- Prep Issues
- Ship in own Container
- Carton Content Accuracy
- Overage Purchase Order Units
- Advance Shipment Notices Accuracy
- And more
You can fight those chargebacks as well but it’s harder, as there are just a few external tools for that and there’s no API like Amazon Seller Central’s Seller API to pull the data on demand.
Admission of FBA Reimbursements
Well, of course, Amazon won’t say “yes here’s your money” for every reimbursement claim you file, so Sellers must meet specific criteria to be eligible for reimbursements.
Sellers must provide Amazon with a valid FBA reimbursement report, and Amazon will only reimburse sellers for items that cannot be replaced. Long story short, you need to provide evidence of the lost, damaged, or incorrectly processed inventory / reimbursement. That means, show your bill of lading documents, send inventory pictures before leaving your warehouse, etc
How to File an FBA Reimbursement
This is the tricky part. The simple story is that sellers can use the Amazon Seller Central website to access the Reimbursements section and, from there, provide details of the lost, damaged, or incorrectly processed inventory, along with any supporting documentation.
But, the real story, is very different. First, you need to find the relevant reports, reconcile the information, gather evidences and, then, submit it to Amazon.
Those reports can be found, mostly, under the Inventory reports section of Seller Central but how do you reconcile the information? Using Excels, Spreadsheets or an external inventory management software sounds like a good idea but, believe me, if you don’t know what you’re doing this can take ages.
My advice? you can rely on external services for a more comprehensive approach to filing an FBA reimbursement claim.
Amazon return managers are third-party services that help sellers manage the process of handling customer returns. These services can assist with tracking returns, processing reimbursements, and providing insights on how to improve the customer return process.
There are lots of tools and services around: GETIDA, AmzPro, AMZRefund, AMZReimburse, ChannelMAX, Eva, Refund Retriever, Refund XRay, Refunds Manager, Sales, Seller Bench…
It’s up to you to try their services but, if you ask me, I 100% rely on Chargeguard.co (for Vendors) and Seller Investigators (for Sellers).
How to prevent FBA surcharges
To prevent FBA surcharges from being generated, sellers can take several steps, such as:
- Properly labeling and packaging items before sending them to Amazon fulfillment centers.
- Keeping accurate inventory records and regularly checking for discrepancies.
- Communicating with Amazon customer service promptly if an issue arises.
- Hire an external service that can monitor their inventory reports 24/7
FBA reimbursements can be a valuable source of revenue for sellers, I mean, it’s your money man! But they can also be complex and time-consuming to process.
By understanding the types of reimbursements available, how to determine their value, and how to file a claim, sellers can increase their chances of receiving a reimbursement.
Additionally, using an external service, preventing surcharges and using Amazon return managers can also be helpful in managing the process and it will def help you on your way to get your money back.