Amazon being the largest online marketplace has always placed great emphasis on customer satisfaction. To ensure smooth customer experience for its customers amazon made implementation of clear and effective return policies its primary goal.
Well, 2023 has brought some significant changes into the Amazon return policies for sellers, particularly those utilizing Fulfillment by Amazon (FBA).
No matter if you are a new seller or own a million-dollar brand on Amazon, returns is something every e-commerce business has to deal with.
In this article, we will be exploring the updated return policies and how they impact sellers and their profitability.
Amazon FBA Return Policy:
When you utilize Fulfillment by Amazon (FBA), Amazon takes on the role of managing deliveries and customer service for you, which entails handling customer returns as well.
The decision about whether a product qualifies for a return is governed by Amazon’s own return policy, and as a seller, you don’t get to influence this decision.
However, Amazon is trying its best to make sure the return process is smooth for customers as well as for the sellers. transparency:
Extended Return Window:
In an effort to provide customers with more flexibility, Amazon has extended the return window for FBA sellers. Instead of the previous 30-day return period, customers now have up to 45 days to initiate a return for FBA purchases.
This change allows buyers to thoroughly test and evaluate products, reducing the likelihood of rushed returns and potentially improving customer satisfaction.
So What Exactly Happens When An Order is Returned?
When an order is returned to an Amazon warehouse, the following process generally takes place:
- Receiving the Return: Amazon’s warehouse staff receive the returned item.
- Inspecting the Return: The returned item is then inspected to determine its condition. Depending on the reason for the return, this may affect whether or not the item is deemed sellable or unsellable.
- Determining Sellability: If the item is in the same condition as it was when it was sent out, it’s generally considered sellable and can be returned to your inventory. If it’s not in the same condition (e.g., it’s damaged, defective, or clearly used), it’s usually classified as unsellable.
- Refund: Amazon will issue a refund to the customer based on the original form of payment. If the return is due to an Amazon error, Amazon will take responsibility for the refund. If the return is due to the customer changing their mind, you (the seller) may be charged a return processing fee.
- Dealing with Unsellable Returns: If an item is marked as unsellable, it won’t be added back to your inventory for future sales. Instead, you have to decide what to do with this inventory. You can create a removal order to have Amazon either return the item to you or dispose of it. Note that both options involve a fee.
- Inventory Update: After the returned item has been processed, your inventory in Amazon Seller Central should be updated to reflect these changes.
- Return Report: You can download and review the FBA customer returns report in your Seller Central account for details about each return.
Course of action if the customer doesn’t return the product?
If the customer does not send the product back to an Amazon fulfillment center within 45 days of their initial receipt, Amazon will deduct the refunded amount from the customer’s account and reimburse the seller for the item.
Usually, Amazon automatically reimburses you after 45 days. In rare instances, you may need to initiate a support case to obtain your reimbursement.
Amazon offers a hassle-free return policy for customers who purchase items from the Baby category that are fulfilled by Amazon (FBA). Within a generous timeframe of 90 days, customers can easily return eligible products as long as they are in new and unopened condition.
It’s important to note that items that have been opened or used do not qualify for returns within this extended period. One of the great benefits for sellers is that Amazon covers the cost of return shipping.
This means that sellers don’t have to bear any additional expenses when customers decide to return their purchased Baby category items. It’s a win-win situation for both buyers and sellers, ensuring a smooth and satisfactory shopping experience on Amazon’s platform.
Keep A Close Eye On Your Returns by using the New Return Insight Report?
Well, Amazon introduces a new feature called “Return Insights” tool which is aimed to provide sellers with better insights about their order returns. This tool can be accessed through the “Manage FBA Returns” page.
In March 2023, Amazon unveiled a novel tool termed “Return insights” in the Manage FBA inventory segment. This tool offers sellers enhanced clarity about their returns.
This is a significant upgrade as it reveals to sellers their most frequent:
- Returned product identifiers (ASINs), coupled with the most common reasons for returns. This data, depending on the specified reason, can be instrumental for sellers to enhance their listing descriptions or perhaps upgrade the quality of their products.
- This particular tool allows for trend analysis based on Return Rate % or Returned Units and permits filtering by specified Timeframes, such as 30, 60, 180 days, or the previous year, and by Product Category. Additionally, it provides comprehensive data for each ASIN, which includes the primary reason for returns.
To examine your return insights in Seller Central, navigate to “Manage FBA Inventory” followed by “Manage FBA returns.”
Simplified Returns for International Orders:
Expanding global trade, Amazon has made returns more accessible for international customers. With its vast network of fulfillment centers around the world. It allows international customers to return items to a local address, minimizing the hassle and cost of international shipping.
FBA sellers can now offer international return addresses, making it easier for customers to ship items back to the appropriate location.
This change is especially beneficial for sellers looking to expand their customer base globally, as it promotes hassle-free returns and encourages international buyers to feel more confident when making purchases.
Restocking Fees Customization by Amazon:
Amazon has introduced greater flexibility for FBA sellers in terms of restocking fees. Previously, sellers had a fixed restocking fee for all returns, but now they can set different restocking fees based on specific product categories or conditions.
This customization allows sellers to better align their restocking fees with their actual costs and the nature of the products being sold, providing more accuracy and fairness.
Enhanced Quality Control and Reimbursement for Damaged Inventory:
To address concerns related to damaged inventory during the return process, Amazon has implemented enhanced quality control measures.
FBA sellers can submit claims for reimbursement when they receive damaged items from customers. This change offers sellers a more streamlined process for recovering losses due to returned products in poor condition, fostering a sense of fairness and support from Amazon.
Decoding the Causes of Product Returns:
When operating your business, it is reasonable to anticipate some product returns. However, it is crucial to monitor the reasons behind customers returning your products.
This is especially important if you are selling a private label item, as you must be mindful of any recurring problems or issues your products may have. Promptly addressing these concerns enables you to rectify them swiftly.
NCX (Negative Customer Experience) encompasses returns, damages, and customer complaints related to your products. You can access this valuable information under Performance > Voice of the Customer.
By examining this data, you’ll gain insights into the most frequent complaints, identify products most vulnerable to issues, and discover actionable steps to ensure a healthy NCX rate.
Shrinkage is closely related to NCX and pertains to lost inventory and returned unsellable items. This occurs when a customer purchases your product but returns it in a damaged or non-resellable condition.
It’s worth noting that if your product receives numerous complaints of being defective, Amazon might temporarily suspend your listing until the matter is resolved.
Amazon Account Health Analysis:
In order to diagnose what is causing returns to your products, visit the performance tab in your seller central, click on the “account health” and check the “Policy Compliance”.
If there are any complaints regarding the product condition or listing policy violations you can find them in “Product Condition Customer Complaints” and “Listing Policy Violations”
If your product is temporarily suspended by Amazon, then Amazon allows you to appeal. To appeal, you will have to explain to Amazon how you will prevent the issue in future orders and the steps you took to resolve the issue.
Seller Performance Metrics and their Relationship to Returns:
Amazon continues to emphasize seller performance metrics and their relationship to returns. Excessive returns or consistently poor customer feedback can negatively impact a seller’s performance rating.
This may result in penalties, including account suspension or loss of selling privileges. Therefore, sellers must maintain a proactive approach to ensuring product quality, accurate listings, and prompt customer service to minimize the likelihood of returns affecting their overall performance.
Amazon’s return policies play a crucial role in shaping the customer experience and maintaining seller accountability. The 2023 changes for FBA sellers reflect Amazon’s commitment to improving the return process and providing a seamless shopping journey for customers worldwide.
By adapting to these policy updates, sellers can enhance customer satisfaction, build trust, and maximize their success on the Amazon platform. Understanding the nuances of these changes and how they impact FBA businesses is essential for sellers aiming to thrive in the competitive e-commerce landscape.