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Originally published on April 27, 2023, updated August 1, 2024
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In this guest article, the Getida team explains why Amazon might owe you money and what you can do about it.
This article includes a 2024 update regarding two recent Amazon reimbursement changes.
As a Fulfillment by Amazon (FBA) seller, you may be entitled to some money. FBA inventory reimbursement can happen for a variety of reasons, like if Amazon mishandles your inventory, customer orders, and returns. Or, you may be reimbursed if Amazon destroys your products or overcharges FBA fees.
But doesn't Amazon automatically issue reimbursements when mistakes happen? Most of the time, the answer is no. It’s up to you to identify an Amazon FBA error and file the proper claim. The problem is that most Amazon sellers don’t have time to look for these issues, let alone document them. But if you aren’t looking closely at your Seller Central account, you're probably losing money.
Getida, an FBA reimbursement solutions company, estimates Amazon sellers are, on average, losing anywhere from 1-3% of their annual revenues. What does that look like? For a million-dollar business, that means anywhere from $10,000 to $30,000 may easily be left on the table.
No matter the size of your business or the amount of money you're losing in unclaimed reimbursements, ignoring this issue is only hurting your bottom line. You'll end up paying Amazon more than necessary and missing out on potential reimbursements, which can be detrimental to the success of your business.
To properly understand the Amazon FBA reimbursement space and learn how you can recover the money you're owed, let’s take a look at the following:
Ready? Let's get started.
An FBA inventory reimbursement is owed to you whenever any of your products are lost, damaged, improperly returned, destroyed, disposed of, or overcharged by Amazon for your FBA handling fees.
Below, we break these down a bit more to see how you might be losing money from unclaimed FBA reimbursements.
It's not unheard of for products to go missing during shipping or while they're stored in the warehouse, especially if they're mistakenly placed in another FBA seller's account or if there's an issue with the product barcode. To ensure that you're able to locate any misplaced or lost products, it's recommended that you check your inventory reconciliation reports in Seller Central regularly.
Another important report to reference is the damaged inventory report. Look for details about products damaged at the Amazon warehouse as well as during shipping to or from the fulfillment center.
Amazon can destroy and dispose of any of your inventory if it considers the items unsaleable without prior permission or notification.
While losing a few products here or there may seem like the sort of thing that “just happens,” it’s not something to write off as a price of doing business. Amazon charges FBA fees to handle your logistics, and when these sorts of things “just happen,” it's Amazon's responsibility to reimburse you.
July 2024 Update: Amazon announced proactive reimbursements for lost items starting November 1, 2024. However, if you don't receive an automatic reimbursement for a lost or damaged item and believe it should qualify, you'll need to file a manual claim.
Amazon is also updating the FBA reimbursement eligibility window beginning October 23, 2024. Lost or damaged claims must be submitted within 60 days of the item being reported lost or damaged.
Customer returns and refunds are significant sources for a potential Amazon FBA error. This isn't all that surprising in light of Amazon’s rather generous customer return policy and the high level of returns it allows.
You're owed money for FBA inventory reimbursement whenever refunds aren’t paid out, refunds for when customers do not return a product, refunds that are more than the original product price, incorrect or damaged items are accepted for returns, and when refunds are credited after the stated return dates have passed.
These are probably the hardest to identify and require constant monitoring of your Seller Central reports.
Keep Reading: How to Lower Your Amazon Return Rate
FBA fees are a necessary cost for storage and shipping, but they can be a source of lost revenue. Amazon's Cubiscan system is used to determine the precise dimensions of your products, but this system isn't always accurate.
When products are assigned larger dimensions and/or weights, your FBA fees are overcharged. The only way to prevent and recover overcharges is to compare Amazon’s reported product dimensions and weight with the metrics provided by the manufacturer. You must stay on top of this because Amazon randomly remeasures product dimensions all the time.
Obtaining FBA inventory reimbursement is time-consuming and requires continual monitoring of various Seller Central inventory, shipping, and payments reports. The more SKUs you have, the more laborious this undertaking becomes.
And that’s not all. Once you've identified potential Amazon FBA errors, you then need to document and submit claims to the appropriate departments.
Around 60% of FBA reimbursement claims are rejected due to insufficient or improper documentation.
Incorrectly filed claims are automatically rejected. Moreover, claims that aren’t submitted within 18 months of when the suspected error occurred are no longer eligible for reimbursement.
If you simply don't have the time to handle Amazon FBA reimbursement claims, there are a few options available to you. You could assign the task to an employee, but this may detract from their primary responsibilities, causing them to be less productive. Alternatively, you could hire a virtual assistant (VA), but they may require a longer learning curve.
While there are companies that specialize in recovering Amazon FBA reimbursements, not all of them provide a comprehensive service, leaving many potential reimbursement opportunities undiscovered. Some may not even file claims on your behalf or have a low success rate for winning claims. However, there is a solution available that you can use at no financial risk that gets big results.
Getida (GET Intelligent Data Analytics) offers:
There is no charge to use the software or for Getida to file claims. It’s also simple and easy to get started! Just click the “Free Signup” button and provide the requested information. You should get a report on potential FBA reimbursements within several days. There’s no obligation, and Getida only submits claims with your approval.
Amazon FBA reimbursements are crucial for the continued growth of your company. Once recovered, this money can be reinvested into your business to help you grow and expand on and off Amazon.
Don’t be intimidated by the reimbursement process. Check out Getida’s free Amazon reimbursement tools to get you and your Amazon business on the right track to a healthy financial position. You can also save $500 thanks to this special offer from Getida and eComEngine!
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