Are you in the dark about how much money Amazon owes you? Unfortunately, the answer is probably yes.

Most sellers struggle to monitor their FBA accounts for mistakes and accidental losses. That’s understandable. You’re too busy sourcing new products, testing new marketing techniques, or continually optimizing your listings.

But what’s the point of working so hard to make money if you don’t know how much you’re losing?

Think of FBA mistakes as leaks.

You’re pouring money into your FBA account with new sales, and a small percentage of that is leaking out. The more that goes in, the more that leaks out due to Amazon errors that are bound to happen.

Handling the process on your own is a hassle. What you need instead is an FBA reimbursement service. Here’s what to look for when signing up.
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FBA reimbursements are unfortunately a complicated facet of selling on Amazon. “How long do I have to file a claim?” is a question we hear often. That’s why we’re taking a moment to give you the short answer and the long answer to this question.

Short answer: 18 months.

Long answer: Keep reading…!

When should you open a reimbursement case?

When you discover an inventory or return discrepancy and want to know when to file a claim, unfortunately the answer is not “right away.”
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When your Amazon inventory is misplaced, you might find yourself feeling a little lost. What happens next? How do you recoup your losses? How can you best protect your inventory?

In this post, we’re covering all of the common questions about misplaced inventory, so you can know how to get your money back and rest easy.

How does Amazon inventory get misplaced?

An Amazon warehouse can be as large as 1.2 million square feet. Whoa, that’s huge. The warehouses operate with what is known as a “chaotic storage system.” Meaning, instead of being organized by product type or seller or some other factor, the shelves are actually not organized at all.
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Considering that lost and damaged inventory is the second most common FBA reimbursement case, we have received a lot of questions from Amazon sellers about this over the years.

If you’re wondering whether or not FBA owes you money, lost and damaged inventory is a good place to start.

Fortunately, Amazon has a very reasonable reimbursement policy to cover common issues and protect you against loss.

Let’s dig into the specifics of the policy, answer some common questions, and review how you can get more money back.

What does the policy cover?

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An Amazon FBA refund is given to a third-party seller when the Fulfillment by Amazon service is found to be in the wrong for something like an overcharged storage fee or a customer return error.

You may or may not know this, but our FBA reimbursement software covers 19 possible cases. That’s a lot of different ways that Amazon can get things wrong and cost you money. The reason that Amazon makes mistakes is because of the massive amount of sales taking place on their platform every minute of every day. The odds are that mistakes will happen.

These various mistakes range from miscalculated and misappropriated weight/dimension fees to product removal orders that never made it from FBA the warehouses back to you.

The fact that we cover 19 different error types certainly helps customers feel secure in knowing that their account is being watched over. But there is a question we get asked a lot, primarily out of curiosity, and this is: Which cases are the most common?

Sellers want to know which case types will likely result in real money being handed back to them. It’s true, not all Amazon reimbursement cases are created equal. Here are the three issues that pop up the most often and account for a large amount of refunds.

Introduction to Amazon FBA refunds

Amazon FBA refunds are given from Amazon FBA to a third-party seller when an error or oversight is discovered. The most common refunds are due to customer return issues and to inventory being lost or damaged.

Think about it. Between all the products in all the categories, the return rate on Amazon is only 5.5%, but when you consider the daily volume, that’s still a lot of returns. With that volume comes more errors.

Similarly, there are over 600 million products for sale on Amazon US, and a large percentage of these products are fulfilled using FBA. Products can get damaged when they’re shipped to an FBA warehouse, in an FBA warehouse, or when they’re shipped from an FBA warehouse to a customer.

Amazon FBA charges sellers to sell on its platform, but it doesn’t intend to overcharge them or make them pay for any of its errors. There are systems in place that typically automatically refund a seller if something goes wrong (if an item gets damaged by an employee, for example).

However, Amazon doesn’t catch all of its own mistakes, which is why most sellers choose to monitor and claim additional Amazon FBA refunds.

Most common Amazon FBA refunds

Let’s take a look at the three most common instances.

1. Customer return not actually placed back in inventory

The return report is an easy-to-access and easy-to-decipher report generated inside of Seller Central that gives the status and reason for any customer return.
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It is very easy for sellers to get caught up in the process of sourcing inventory, shipping it to Amazon, and focusing on the sales. Because the FBA model covers so much of the ecommerce work for you, it’s tempting to sit back and leave everything to Amazon.

But you’re still in charge of your own bottom line. In other words, sellers still need to manage their own inventory.

A whole host of things can go wrong (and Amazon isn’t always a gentle giant to deal with), but today we’re talking about one common issue: seller inventory that has been damaged by Amazon.

Accidents happen—especially in Amazon warehouses

The reality is that all sellers are owed money by Amazon.

With such a massive amount of inventory, mistakes are bound to happen. That’s why Amazon has the FBA Lost and Damaged Inventory Reimbursement Policy to settle the score with sellers. It’s only fair that if you’ve tasked them with handling your inventory they reimburse you should they damage it. This policy covers inventory damaged by an Amazon carrier or inside a warehouse.

While Amazon automatically reimburses sellers for items they have damaged (less any FBA fees they would have been taxed had it sold), there are glitches in the system that can prevent sellers from getting paid.
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Over a third of purchases on Amazon happen in the final quarter of each year. December sees more Prime signups than any other month, as people scramble to ensure that their orders will be delivered in time for Christmas.

While brand new sellers do so poorly in Q4 that Amazon barred them from sending in inventory, established sellers benefit from higher sales at the end of the year. When sellers learn which products move during Q4 and know how to price their items, they can experience much higher sales volume than any other time of the year.

Higher sales volume leads to higher returns.

Why there are more Amazon FBA returns in January

The return policy for items sold and fulfilled by Amazon is a standard 30 days, however Amazon also has a Holiday return policy. This allows customers to return any item shipped between November 1, 2016 and December 31, 2016 until January 31, 2017—meaning that the month of January will not only see returns from December purchases but November as well.
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