Can Sellers Get Amazon FBA Refunds?

Sellers who use Fulfillment by Amazon often do so for the convenience it brings. But can they receive Amazon FBA refunds if something goes wrong? We go over what to expect, and how third-party services might be able to help.

Can Sellers Get Amazon FBA Refunds?

Sellers who use Fulfillment by Amazon often do it to alleviate some of the big headaches that come with online sales. Let's say a customer places an order. Amazon will make sure each item in the order makes it out their door and to your customer's in one piece. You as the seller need only ensure that Amazon has your inventory in stock. The rest is up to them.

 

Many sellers love this convenience, but what if there's a problem with an FBA sale? Can a seller get an Amazon FBA refund if the situation calls for it? The good news is that sellers are able to get Amazon FBA refunds — in some cases. We'll go over what to look out for when using FBA, and how third-party services might be able to help with reimbursement issues.

Let's begin by talking about what Amazon can do for FBA sellers.

Amazon will cover the cost of lost or damaged inventory, returns that don't get sent back, and even incomplete FBA returns in some instances. According to Amazon Seller Central, Amazon will either replace damaged items with one that has the same fulfillment network stock keeping unit, or they'll reimburse you for the cost of the item.

What Amazon means by the cost of the item and what the seller expects could be two different things, however. Amazon Seller Central clarifies that they'll "compare several price indicators to determine an estimated sale price for the item when calculating the reimbursement amount." This happens regardless of what amount you claim.

They could reimburse the item for the median price you've listed it at over the last 18 months, for example. They'll also compare it to the amount other sellers have charged for the same item. And they have the right to estimate a cost per unit; what's more, they won't refund Amazon seller fees such as referral or fulfillment fees in the process.

Linoto CEO and founder Jason Evege [EH-veg -like vegetable] says, "When I started out... Amazon only reimbursed 85 percent of the cost of the item." Linoto is an artisan linen sheets company manufacturing in New York.

Another downside to using FBA as part of your business model is that mistakes are bound to happen.

This is due to the sheer number of sellers and the even larger number of products for which FBA is responsible. Worse, Amazon might not automatically give you an FBA refund.

Sellers have to keep on top of all their FBA sales, in other words, and follow up if they realize Amazon has made a mistake. You're also locked into a nine- or 18-month claim window, depending on the point in the fulfillment process your item was damaged or lost. Amazon no longer has to reimburse you if you wait longer than that.

Refund Retriever president Brian C. Gibbs says, "Some of the companies we work with never see a single screwup, while for others, we literally find thousands of dollars owed in reimbursements." Refund Retriever is a company that specializes in finding and refunding Amazon sellers when Amazon makes a mistake.

For Linoto's Evege, trying to get a refund can end up costing him painfully in time and energy. 

Sellers have to first open a case in order to file a claim, and sometimes they have to follow up with photographs and other forms of documentation. He says, "rather than making money from the sale, you end up spending your own time creating a case so you can get part of your money back. … Then you have to wait for them to get back to you. You can't afford to lose that money, but you also can't afford to lose all that time and effort."

That's where companies like Gibbs' come in handy. He says, "if we do it for you, we have a process. … A seller might speed through, but we're combing through every piece of monotonous information."

Refund Retriever and businesses like it aren't imperative, but they can be helpful.

Consider the money you're saving on things like the overhead of a brick-and-mortar store, and it might even make sense that you spend some cash for the peace of mind. After all, you'd be dealing with your inventory and customers face to face if you were operating a physical store.

Refund Retriever only charges if they find you're owed a refund, and then they take a percentage. Outsourcing Amazon reimbursements can be well worth it if you consider those FBA refunds to be "found money."

According to Refund Retriever's Josselyn Mejia, her job as an Amazon Specialist is to make sure there's an outcome for any mistakes. She says, "We're following the entire life cycle of your inventory. … We don't use any automation. If you have things in FBA, you want to make sure you're getting paid for it. 

You're subject to all the risk that goes with it when your relationship is between you and Amazon, and not you and a customer. FBA makes online retail a whole lot easier for most Amazon sellers, but it also creates additional barriers. But there are ways to make sure that the comfort you get from knowing Amazon will fulfill your orders isn't outweighed by the fear that you might lose money in mistakes you fail to catch.

Just knowing you have to look for those mistakes is a great place to start.

That's all for this edition of the DealNews Seller's Guide. If you liked what you heard, be sure to subscribe so you'll never miss a new one. And if you want to learn how you can turbocharge your Marketplace revenue and gain access to the exclusive DealNews traffic network, head to advertise.DealNews.com , or send an email to advertise@DealNews.com.

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