The Cancellation Rate is the number of seller-fulfilled orders cancelled by the seller prior to ship-confirmation divided by the number of seller-fulfilled orders in the relevant time period. When calculating this metric, we consider all order cancellations initiated by the seller for any reason.
Why are seller-cancelled orders bad?
It's important to ensure that items you've listed on Amazon are in stock and available to ship. When you cancel an order placed by a buyer prior to fulfillment, it's usually because the item is out of stock. Of course, some percentage of stock-outs might be unavoidable in normal business practice, but we expect you to try to minimize such issues. High cancelled order rates are a problem that can impact your selling account. In the short term, it also negatively affects your bottom line because an unfulfilled order is lost revenue to your company.
What is the difference between a refunded and a cancelled order?
A decision not to fulfill an order prior to ship-confirmation is treated as a cancelled order. Once an order is ship-confirmed, a decision to accept a return or not ship an item is treated as a refund. Refunds are not always negative events but a high Refund Rate can often be a sign of an underlying issue worthy of review.