Amazon FBA Returns Policies and Settings
Managing returns and providing quality customer service are two of the most important tasks for Amazon sellers. Amazon is customer-focused and strives to make both the shopping experience as straightforward and easy as possible. Sellers that fail to manage returns and refunds promptly face account health issues and serious consequences. To maintain selling eligibility and a high customer satisfaction rating, it’s important for sellers to understand Amazon’s s return policies and be prepared to take necessary actions. This article breaks down the process for managing both FBA and seller-fulfilled returns, along with steps for how to update applicable settings.
FBA Returns Policy
With FBA fulfillment, Amazon is responsible for providing customer service and managing returns. When a returned item is received at the fulfillment center, Amazon evaluates the product’s condition and determines if it is sellable. If the product is in sellable condition, the unit is returned to the seller’s sellable inventory. If the condition is unsellable, Amazon determines who caused the damage and if the seller is eligible for reimbursement. Returned inventory with expiration dates and products that are in the consumables or personal care categories will always be classified as unsellable. Amazon may also determine a unit is unsellable if the product or its packaging are damaged, defective, or lack the required labels.
Once a product is classified as unsellable, Amazon sellers need to create a removal order or request that the units be disposed of within 30 days of the returned unit being received. Both removal orders and disposals incur a one-time fee based on the product’s shipping weight. In addition to removal order fees, ASINs with a return rate above the category average will also be subject to a returns processing fee. The return processing fee does not apply to products in the shoes and apparel categories. For more information on the returns processing fees, see this Amazon help page.
FBA Return Settings
To recover value from unfulfillable customer returns, Amazon offers the FBA Grade and Resell program. Through this program, Amazon evaluates the condition of returned units and creates a used listing on behalf of the seller. Each returned unit is assigned a condition, varying from Like New to Acceptable. The Grade and Resell SKUs are named with the prefix “amzn.gr” and have a two-letter suffix that indicates the condition. To manage pricing for the graded inventory, navigate to Automated unfulfillable settings and set the initial list price for all ASINs. The initial price is a percentage of the listed price for the item when it’s in new condition.
To edit the FBA Grade and Resell Program, navigate to the Automated Unfulfillable Settings page and check the box to enroll or opt out. This page also lets sellers explore other value recovery options, including liquidations and refurbishment. At the bottom of the page, sellers can update settings for the unsellable returned units that cannot be recovered. Damaged units can either be shipped back to the seller’s return address or be disposed of.
Seller-Fulfilled Returns
When sellers fulfill orders directly, they are responsible for providing customer service and processing returns. Amazon provides a tool called Manage Seller Fulfilled Returns to simplify the process for sellers. Through the Manage Seller Fulfilled Returns page, sellers can take several actions for each return, including editing authorization, issuing refunds, completing or closing return requests, and contacting the buyer. Most US returns are authorized automatically and given Amazon prepaid labels as per Amazon’s return policy. In some cases, sellers are required to authorize a return and provide the return label along with any specific return instructions.
It’s important for sellers to monitor seller fulfilled returns and take action when needed. Beyond authorizing some returns, sellers may also need to complete or close a return request. This needs to be done when providing a returnless refund, partial refund, or if a buyer cancels a return request. Sellers may also need to take action if the returned item is in damaged condition or is materially different from the ordered item. In these cases, sellers can charge the buyer a restocking fee. If the returned product is materially different, sellers can file a SAFE-T claim but will be required to provide photos of the returned package and other details as evidence.
Frequently Asked Questions - Amazon FBA Returns Policies and Settings
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Navigate to the Automated Unfulfillable Settings and choose which recovery options you would like to enroll in. At the bottom of the page, select either “Return” or “Dispose” to control how unfulfillable inventory is handled.
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Amazon provides customers with a few options for returning their order, either at carrier locations or Whole Foods drop-offs. The customer is given 30 days after the delivery date to return the order and be reimbursed. Amazon issues the refund within 3-5 business days of receiving and processing the return.
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Returnless refunds allow sellers to provide a dissatisfied customer with a refund without requiring that they send the unit back. This setting can save sellers on shipping costs, especially for products that are unlikely to be in sellable condition once returned. To update this setting, sellers can navigate to the settings drop-down menu and select “Fulfillment by Amazon.” From there, scroll to “FBA customer returns settings” and click “Edit” next to “Returnless Resolutions.
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Navigate to Reports on Seller Central and select “Return Reports.” Sellers can pull reports for custom date ranges to see details for both FBA and MFN returns. To see FBA return details specifically, select “View FBA Reports” at the top of the page. Once redirected, sellers can pull reports specific to FBA customer returns and FBA Grade and Resell reports.
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For a comprehensive report on the processing and evaluation of returned FBA inventory, navigate to Amazon Fulfillment Reports and download an FBA Grade and Resell report. This report provides a summary of the most important data, including the graded condition, Amazon-created resell SKU, and original order IDs.
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When a customer returns an item using the Amazon prepaid return label, the refund is automatically issued due to the Refund at First Scan policy. If the unit is received in unacceptable condition, the seller can charge a restocking fee or pursue a SAFE-T claim.
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Depending on the return reason, the seller or the buyer may be responsible for return shipping. For example, if the return reason is “Accidental order” or “No longer needed”, sellers can issue a partial refund and deduct the cost of return shipping. If the provided return reason was “Damaged” or “Defective,” for example, the seller is responsible for the return shipping cost.
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As an Amazon seller, you must accept returns as per Amazon’s selling policy. Amazon prioritizes customer satisfaction and requires that sellers handle returns and refunds promptly. For more information, see Amazon’s Return Policy.
Conclusion
Effectively managing returns ensures sellers comply with Amazon’s policies and maintain a high satisfaction rating. Sellers should be aware of the actions they need to take when managing returns, such as authorization, issuing refunds, and closing return requests. Sellers can even reduce costs by exploring inventory recovery options or opting into returnless refunds.
About the Author - Stella Nelson
This post was written by Stella Nelson, an Account Manager at Goat Consulting. Stella helps her clients sell on Amazon by increasing sales, mitigating risk, reducing costs, and solving problems. Stella has specific experience analyzing return data to help clients reduce unnecessary returns and operate more efficiently and providing Amazon FBA and fulfillment consulting for brands and manufacturers. If your business has a high return rate or needs assistance with other aspects of managing your Seller Central account, Stella is happy to help.
