FBA inventory reimbursement policy updates, less payout for damaged?

#1

Anyone else get an email about an update to FBA inventory reimbursement policy?

“Effective November 11, 2022, we are changing the FBA inventory reimbursement policy to update how we calculate reimbursement value for fulfillment center operations claims for items that are in an unsellable condition at the time they are lost or damaged. For unsellable items, Amazon will reimburse you at a valuation consistent with the estimated proceeds of the discounted sale of the unit. For more information, go to the FBA inventory reimbursement policy.”

Does this mean that if they are reimbursing us for WH damaged, they are going to pay us for a damaged product instead of a new one?

https://sellercentral.amazon.com/help/hub/reference/GQHQGBTD7XB7EECN

@Wyatt_Amazon
@KJ_Amazon
@TaylorR_Amazon
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FBA inventory reimbursement policy updates, less payout for damaged?
#2

It looks pretty clear to me.

You’ve got a widget that sells for $200. It is unsellable condition for some reason, and Amazon loses it or breaks it further (see today’s thread about a forklift damaging an item that was already damaged, and Amazon not being willing to pay for it because the item was already unsellable).

So now Amazon is going to pay you what THEY think the item’s damaged value is.

So that $200 widget that was maybe worth $100 because it was damaged, you will now get maybe $28:

This represents the $50 Amazon thinks you could have sold it for as a damaged item (see what I did there?) less commission and shipping fees that would have been applicable, had it actually been sold at that price.

So you will get maybe 14 cents on the dollar, :angry: and you’ll like it!

Disclaimer: This is merely my interpretation and in no way represents actual Amazon policy (or does it?)

FBA inventory reimbursement policy updates, less payout for damaged?
#3

Hello @PoundCake:

Thanks for asking this question. Here are a few excerpts from the FBA inventory reimbursement policy:

How we calculate reimbursement value

  • If we elect to reimburse you for a fulfillment center operations claim or a removal claim, we will reimburse you for the estimated proceeds of the sale of that item, unless the item was in an unsellable condition when lost or damaged or when removed from the Amazon fulfillment network. [Note: "Estimated proceeds" means the estimated sale price of the item for which you are being reimbursed minus referral fees and fulfillment fees.]
  • For unsellable items, Amazon will reimburse you at a valuation consistent with the estimated proceeds of the discounted sale of the unit. We may ask you for additional information or documentation to help us determine that discounted value.

If you don't agree with the Amazon valuation of a unit, you can file a claim using the Contact Us page in Seller Central within 90 days after we issued the reimbursement.

The FBA inventory reimbursement policy: Fulfillment center operations claim page provides more detail on items that are lost or damaged by an Amazon fulfillment center or facility operated on behalf of Amazon.

Tiff

#4

Hi Tiff,

Thanks for your post.

FBA is defaulting to a 50% reimbursement valuation for units with unsellable disposition. For resellers of high ASP items with low margin, a 50% default valuation is not sufficient and NOT ‘consistent with the estimated proceeds of the discounted sale of the unit’

The amount of the reimbursement is (a) significantly less than a seller’s cost which the manufacturer would credit a seller if the unit was returned to them and not misplaced or disposed of by FBA and (b) significantly less than ‘a valuation consistent with the estimated proceeds of the discounted sale of the unit’ if the seller were to choose to sell the item as Used or Renewed.

Your comments reiterate Amazon’s policy that a seller can request a reimbursement re-evaluation if they don’t agree with the Amazon valuation of a unit, but the SPS and SAS teams are denying all reimbursement re-evaluation requests for units with unsellable dispostion even when the seller presents an invoice showing their cost or links to used and renewed listings demonstrating the value of the unit.

Amazon is not abiding by their own polices.

#5

I am in this exactly predicament.

I sell Amazon Renewed electronics
My margin is under 10% most times.

Amazon loses a ton of inventory and reimbursed 50%

This is ridiculous

Can someone from Amazon please chime in here?

#6

Hi @murray:

Thank you for posting a follow-up question in the thread. Have you already tried opening a support case to file a claim about Amazon's valuation? Please let me know if there are any cases that you'd like me to investigate further.

Thank you,

Tiff