Taking advantage of Amazon FBA ((Fulfillment by Amazon) offers great benefits. Amazon takes care of all the storage, shipping and customer service so that you, as a seller, can focus on other aspects of your business. These take a load off your shoulders.
While it may sound glamorous, Amazon doesn't take 100% of the work off your plate. Amazon FBA does make your life easier, however, many sellers, unfortunately, are not aware that Amazon does also make mistakes. Some sellers don't look at their inventory numbers, but ultimately you are accountable for your bottom line.
It takes a lot of diligence as an Amazon seller to stay on top of reimbursement claims for lost and damaged items as Amazon keeps updating and changing its policies. Most of the time, it could be challenging to find the report that tells you when there is a reimbursement opportunity for you. But done right, you can recover lost revenues and protect your business.
Understanding Amazon's reimbursement policies and procedures
Amazon FBA reimbursement is a process whereby Amazon sellers can file claims for payments due to lost or damaged inventory that occurs while it is stored in Amazon’s fulfillment centers.
While the FBA program is a convenient way to outsource inventory storage and order fulfillment, there is still a risk of lost or damaged inventory, which can impact a seller's bottom line.
Thankfully, Amazon’s policies enable sellers to file for reimbursement for discrepancies such as lost and damaged inventory, overcharged fees, and customer returns/refunds.
Lost or damaged items can result from many things, such as handling or inventory issues in the fulfillment center or during the shipment. Some reimbursements in these cases may be done automatically, but usually you will have to file a claim for it.
Customer returns or refunds, on the other hand, are already part of the post-selling FBA services. However, Amazon might sometimes overlook things and refund customers who have not returned the product yet. If this happens often, you will surely not get any more profit.
The FBA service also has different payment tiers, depending on the product you sell, its size, and storage needs. So, there are some cases of overcharging of fees, whether it be storage fees, commission fees, or shipping fees. In any case, Amazon should compensate for any overcharged dues as well.
Steps in filing a reimbursement
First, you need to identify the issue by looking at your inventory report, which shows the data and status of your inventory in Amazon fulfillment centers. To do this, request an Inventory Adjustments report — a .csv or a .txt file which you can open as a spreadsheet.
Once you have identified the issue or any opportunity to file a reimbursement, the next step is to submit a claim for FBA reimbursement. For this to be more successful, providing ample evidence to support your claim is needed.
In cases of lost or damaged inventory, it will be much more helpful to provide documentation such as proof of inventory ownership, proof of delivery, or photos of damaged items. If the claim pushes through, then Amazon will likely reimburse you with the amount in 5 to 10 business days.
Claiming reimbursement for customer returns can be done by looking into your FBA customer returns report through the Seller Central Account. You can see if your items have been returned to the warehouse or if Amazon has already refunded the customer.
Ideally, you can file for a reimbursement claim after 45 days have passed since the customer initiated the return and Amazon has not refunded you yet.
Meanwhile, overcharged fees such as additional shipping or storage fees are rooted in incorrectly measured items. To file for reimbursement for incorrectly measured items, request Amazon to re-measure your product, which you can do once in six months. When the re-measuring is approved, you can ask for reimbursement of the excess fees you have paid.
To track the status of your reimbursement requests, go to your Seller Central Account and follow these steps:
- Go to Reports, then select the ‘Fulfillment’ tab
- Go to Payments → Transaction View
- Under the Type menu, choose Reimbursement
- Generate your reimbursement report.
Upon checking your reimbursement status, if there is a need to follow up on your request, direct yourself to the Amazon Help service and take the following steps:
- In the Help tab, click Contact Us
- Click ‘Selling on Amazon’ → Select Customers and orders
- Input the order number or code, then click next
- Select ‘Return and refund issues’ → Select Other customer and order issues
- Elaborate the details of your case and submit.
Tips for filing successful reimbursement claims
It is important to identify and recover any opportunities to reimburse. One major tip is to do your audits regularly and to pay attention to your inventory reports.
It will also benefit you as a seller if you have extensive knowledge of how you might need reimbursements.
If you are looking for long-term success in Amazon, you should note that filing a reimbursement claim is as regular and normalized as it should be. And to make things easier for you, creating a template that is tried and tested to work will go a long way in making your reimbursement requests easier.
To be efficient, here are some points to remember:
- Make a detailed record of your inventory. Be aware of all the data Amazon Seller Account provides and its policies and guidelines. Know how to identify the issues that may arise and how to address them.
- Always provide supporting documentation. The Amazon support team will most likely process your appeal quickly if there is evidence that supports your reimbursement request. Be efficient since it will save you time and resources.
In conclusion, the success of your business relies on many factors other than the quality of the product you are offering; how it reaches your customer is also a huge determinant of your overall service, which might not be in your control if under Amazon’s FBA service.
Diligently monitoring your inventory on Amazon, and filing for reimbursements when needed, go a long way. It ensures that you maximize your profits while having all the convenience Amazon’s FBA service offers.
Yet though it’s ideal, we understand that it's difficult to keep track of everything, especially when it comes to reimbursements. That's why having a team of experts to handle cash flow opportunities like this can be a huge help.
Our Candy Collect Recovery Process is designed to support sellers like you get what Amazon owes you, so you can focus on growing your business.
Don't let lost or damaged items, customer returns, or other issues affect your bottom line.
Talk to us today and start getting the reimbursements you deserve!
