Recover Your Funds – Amazon’s FBA Inventory Reimbursement Policy Explained

There is no question that using Amazon FBA offers you significant advantages as a seller. But you should always keep your eyes open, as not everything runs smoothly in the multi-stage and complex FBA processes. Before this backdrop, knowing what’s what in regard to Amazon’s FBA reimbursement policy is critical for sellers. As an example, an item you send to Amazon via Inbound Shipment can be damaged or even lost within the online giant’s sphere of influence. This can occur at a logistics center or during the transportation service operated by or on behalf of Amazon. 

The relevant policy states that Amazon will replace such items with a new item of the same FNSKU or reimburse the seller based on the price. At first glance, this sounds simple. Nevertheless, a product is considered eligible only if certain criteria are met. For example, it is generally assumed that their seller account is in regular status at the time of the refund request, meaning that the account has not been suspended or restricted. In addition, the following points must also be met:

You can request a refund yourself if Amazon hasn’t already reimbursed you for the lost or damaged item, provided that all of Amazon’s policy requirements have been satisfied.

Manual FBA Inventory Reimbursements: Lost or Damaged Items

A number of things must be taken into account when filing a claim, depending on the fulfillment step in which the loss or damage to the item occurred. Often, however, the manual analysis and filing of a claim is hardly economically feasible. In the following, we will therefore not only discuss the four possible cases and their special features, but also explain how an automated workflow can be set up.

Shipment to Amazon

If your item was lost or damaged during delivery to Amazon via Inbound Shipment, the shipping workflow (“Summary” page > “Reconcile tab”) usually displays the note “Eligible for investigation”. In that case, you can submit a refund request for the shipment in question. Effective September 5, 2024, the claim window eligibility is being updated as follows:

Read more about it here.

Before you submit the claim for reimbursement, certain information must be verified and confirmed, if necessary. To do so, first familiarize yourself with the details of “Reconcile your shipment”, if you have not already done so. Also, confirm that the contents of the shipment and the information on your delivery schedule match. Finally, based on your “Reimbursements report”, make sure no reimbursement has yet been received for the affected item. This last step also applies to subsequent cases.

After checking, are you still convinced that the item is eligible for reimbursement? If yes, you are ready to start the claim process. To do so, you need to use the “Reconcile” tab for lost units and the “Get support” page in Seller Central for damaged units. In both cases, Amazon requires at least the following information and documentation:

Now Amazon will decide whether the item is eligible for a refund or not. It is essential to note that for the case “Shipment to Amazon“, according to the guidelines, only one request per shipment can be made and all other requests will be rejected. 

Fulfillment Center Operations

You may notice in your “Inventory Adjustments report” that your goods were lost or damaged at an Amazon logistics center or a third-party location operated by the online giant. Starting November 1, 2024, Amazon will begin automatically reimbursing sellers for FBA items lost in fulfillment centers, with payments issued as soon as the loss is reported.

Additionally, the reimbursement window will be significantly reduced –from 18 months to just 60 days – giving sellers much less time to file claims and increasing the risk of missing out on reimbursements.

Especially now, Amazon tools like Lost & Found Full Service are more important than ever. Get your refunds identified and recovered automatically and in time – without having to lift a finger.

After taking into account the reduced timeframe, review your “Inventory Adjustments report” and then confirm the date and correction code for the loss or damage of the item in question. Based on the information in the “Inventory with Fulfillment by Amazon”, make sure that the item was not recovered and/or picked up in a sellable or damaged condition. In that case, make sure the damage did not occur within Amazon’s control (e.g.: the item was already defective).

Now, look at the respective refund status in “Fulfillment Center Operations” or on the “Get support” page in Seller Central. Submit a request if necessary. For damaged items, enter the so-called Transaction Item ID (TRID) in the corresponding Amazon tool. For lost products, enter the FNSKU. Both can be found in the “Inventory Adjustments report.” Amazon might ask for additional information, such as the date or location of the damage or loss.

FBA Inventory Reimbursement – Customer Return

It may also happen that items from a customer order are lost or damaged and Amazon grants a refund or replacement delivery to the customer on your behalf. In this case, a 60-day waiting period allows customers to return items for processing. Sellers can then submit claims between 60-120 days after the refund or replacement date, giving ample time for resolutions.

Did you notice in “Manage FBA returns report” that Amazon has issued a refund or replacement? Then check your “FBA customer returns report” to see if the item in question has been restocked. If not, a refund request can be submitted. To do this, use the appropriate tool under “FBA customer returns” or on the “Get support” page in Seller Central.

FBA Inventory Reimbursement – Customer Return

FBA inventory reimbursement under a general adjustment is compensation provided by Amazon for inventory discrepancies that don’t fall under specific predefined categories like damage or loss. These adjustments can occur due to various reasons, such as administrative errors, incorrect inventory counts, or other miscellaneous issues discovered during audits. When a general adjustment is made, Amazon assesses and reimburses the seller for the difference or discrepancy identified

Removal Order

When Amazon sellers create a removal order, inventory is shipped from an Amazon fulfillment center to the specified address. If items are lost or damaged during this process, sellers can file for removal order return reimbursements.

To qualify, sellers must submit a claim within 60 days from the removal order’s creation date. If the item is marked as delivered but was not received, the claim should be filed within 30 days of the delivery date.

Claims can be submitted through Amazon Seller Central under the “Reimbursements” section. Sellers must provide details, including shipment IDs, tracking information, and proof of inventory ownership.

Amazon may automatically reimburse for certain losses without the need for a claim, but it’s crucial for sellers to monitor their shipments. Items eligible for automatic reimbursement usually include those confirmed as lost by Amazon’s logistics partners.

Sellers should be aware that reimbursements may not cover the full retail value but rather the “fair market value” of the items, factoring in Amazon’s FBA policies. Regular tracking and timely claims are essential to avoid missed reimbursements.

Automated Search for Lost or Damaged Products

Once you reach a certain volume of orders and a certain number of items, you can quickly reach the limits of your capacities. After all, it is hardly economically feasible to control and reconcile vast amounts of information. An automated search for discrepancies with the help of our SELLERLOGIC Lost & Found tool can solve this problem. 

SELLERLOGIC Lost & Found Full-Service is the industry’s most accurate Amazon tool for handling FBA reimbursement claims. Having reimbursed amounts to Amazon sellers ranging from four to six figures after the first audit, the solution doesn’t only dig deeper than regular reimbursement tools, it also enables you to reclaim your funds with zero time investment. Recover your funds swiftly and with assurance – SELLERLOGIC undergoes Amazon audits on an annual basis and is therefore constantly in compliance with Amazon’s rules and regulations.

This means that SELLERLOGIC identifies, analyzes, and returns your money fully automatically – almost no action needed from your side.

Since day one, SELLERLOGIC is improving existing services and developing new ones to ensure that you are winning on every step of your Amazon FBA journey. The introduction of SELLERLOGIC Lost & Found Full-Service is a part of this endeavor.

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