Amazon FBA Return Policy: Amazon Seller Should Know in 2024

How does the return policy on Amazon influence sellers? It doesn’t matter whether you are a new seller or a well-known brand; there is something that any e-commerce business has to handle sometimes – return processing. Of course, it’s always a bit disheartening and frustrating to see customers request a return. It is not just about losing money, it also means that your client was unsatisfied with your goods.

Anyway, customer returns are an integral part of e-commerce, so there is no need to panic if you face it. So, this blog will explain the Amazon seller refund policy and Amazon FBM return policy principles and help you reduce your return rate.

What is Amazon Seller Refund Policy?

Fulfillment by Amazon is the platform’s way of setting up its rules for customer returns. It’s a wide number of rules and standards. However, if you abide by those and treat your customers fairly, all parties will be satisfied with the deal.

In most cases, products that are shipped from Amazon, including the platform’s warehouses, can be returned within 30 days. Nevertheless, a few products have specific policies or requirements associated with them. For example, sellers fulfilling themselves (FBM) can decide their return policy window. However, the platform prefers a 14-day or longer return policy.

Besides, when a third-party seller fulfills the product, the shopper can be charged the Amazon restocking fee of up to 20%. It applies even if the item is returned to the Amazon seller in its initial state within 30 business days.

After all, the platform wants merchant and customer fulfillment alike. So it provides a few specific ways to please customers. For shoppers, this takes the fear of losing their money off. At the same time, it keeps the clients happy, so they are likely to become return customers every seller needs and wants.

Amazon Seller Return Policy: Why Do Customers Return Products?

Each time shoppers complain about a return to Amazon, they must choose the reason for the return. In addition, the reasons for their requests determine whether the seller or buyer bears shipping costs.

The full list of official reasons for a buyer’s return is available on the Amazon.com website. So don’t forget to check it out.

In general, merchants on Amazon are responsible for issuing a refund in the following situations:

• An item does not work
• Some details are missing

Below we also provide the most common requests for why clients return the product:

• It was delivered too late.
• They are not happy with the product’s quality.

At the same time, the client will be at fault if they specify the following reasons:

• The lower price becomes available.
• There was no preferred color.

Buyers are usually responsible when they have issues with personal preferences, size, or change their minds about the goods.

If the goods are approved for return because the buyer has changed his mind, the return process must meet the following requirements:

• All documentation and packaging must be sealed and intact, including manuals, boxes, warranty cards, authenticity, classification, and evaluation certificates.
• Goods must be unworn or new.

Merchants must type their return address in the selected state or cover the return shipping expenses. You can reimburse the shipping costs when the buyer sends a return delivery receipt or provide your customer with a prepaid return shipping label.

Amazon FBA Return Policy: International Orders

In short, when you offer your goods on Amazon in many countries, you should provide your clients with one of the below options:

• Irrevocable Refund: Shoppers can receive a 100% refund without returning the item.
• Domestic return: The buyer can return the item to their preferred local address.
• Prepaid International Return Shipping: Sellers can give clients their prepaid return label, including tracking.

How Do Customer Returns Influence Seller Performance?

The seller isn’t only worried about revenues and profits. Otherwise, it would demonstrate greed and even ruin the business. Performance metrics cover how shoppers have been treated and the company’s productivity, quality, efficiency, and many other factors. But, what is most important, they include customer satisfaction.

Customer returns influence the metrics because some essential interactions between the client and the seller aren’t dried and cut. A great number of returns can prevent growth and cause damage to Amazon’s business. The following are examples of how returns impact a seller’s performance.

• Return Costs – If customers return products to Amazon.com, even if they still can be stored and resold, the platform charges an Amazon restocking fee of 20% and shipping commissions for the returned purchase. If Amazon cannot resell the returned goods, sellers will be charged more than a fee of 20%, shipping commissions, and extra disposal fees.
• Store Performance – Many returns will boost the Amazon seller’s performance metrics in the Order Defect Rate. The platform needs ODR to be 1% or less. Otherwise, sellers won’t be able to work on Amazon, or the platform will remove their sale privileges.
• Negative Reviews – The main reason shoppers ask for returns is that they are not content with the item itself. When it’s an issue with product quality, you will probably get negative reviews that will damage your sales, listing rankings, and overall brand image.

Nevertheless, return isn’t always something 100% bad.

Amazon sellers can learn to look at things from another angle and consider the positive influence it brings. Find out more about the issues with your goods from the client’s feedback and improve the items. Study if something is wrong with your selling processes, and improve the product quality, supply chain, and your business’s operating strategy. When needed, you might try to eliminate the products with a high return rate and opt for the new, more profitable ones.

What is Amazon’s Return Policy for FBA and FBM Sellers?

Amazon sellers have two different seller account options: Fulfillment by Merchant (themselves) and Fulfillment by Amazon (the platform). It results in different return policies.

Amazon FBA return policy

The Amazon platform automatically guarantees claims for all customer returns that satisfy the Amazon 3rd-party return policy and provides shoppers with prepaid shipping labels on Amazon sellers’ behalf. It means that the process of return is much easier for shoppers. They can easily return any products to Amazon.com and expect a refund. Of course, as a seller, you will need to bear all the respective costs. However, there is still an opportunity that, under the platform’s control, sellers will get reimbursement for lost or damaged items.

Amazon FBM return policy

In this case, the seller can better control the company when working with Amazon. However, the platform reserves the right to accept or deny an item. When clients ask for a return, it requires the FBM merchant’s approval. After receiving shoppers’ returned products, Amazon sellers will have to issue a refund manually. For example, the sellers might refund the buyer directly without returns when the shipping fee is too high. Otherwise, they might rent some location to serve as a temporary return warehouse to save shipping fees and time from getting the returned items.

Seller-Fulfilled Prime Returns

Amazon Prime is a subscription service from Amazon that gives members access to exclusive shopping and entertainment service. Like Amazon’s ordinary shopping service, Prime also accepts third-party online sellers. If you become a seller for Prime, you will be able to deliver products directly from your warehouse to your customers using the Prime badge.

Some say this badge is a badge of honor, so selling on Prime is much sought after.

Amazon Prime’s return policy, however, is like a hybrid of FBA and FBM. Like in FBM, Prime third-party sellers are mostly responsible for issuing a refund to their customers who request a product return. However, like in FBA, there are instances when Amazon will do that for you. 

But perhaps the unique aspect of seller-fulfilled Prime returns is the power of sellers to dispute any refund administered by Amazon. This dispute, which could give sellers the power to get back the money they lost in refunds, is called a SAFE-T claim.

To learn more about Prime’s seller-fulfilled refund reimbursement policy, you may read all about it here. 

How Should Amazon Sellers Deal with Customer Returns?

Why do buyers return the purchased items? Clients may do it for many reasons, and not all customers are honest.

To begin with, someone in the Amazon warehouse might send the wrong products, or the goods might get damaged. Item shipping containers might be harmed, making clients afraid to keep or open the item. Also, there can be circumstances where shoppers realize they do not need the product while you have already shipped it. Finally, sellers might face dishonest buyers who received the item, used the product for some time, and then asked for a return and want to receive a refund. Unfortunately, it happens more often than it should.

There are a few recommended ways to deal with return requests in a positive manner:

• Proper communication between the buyer and Amazon will help to explain the return. It’s a so-called customer service that is far from what the process used to be.
• A comprehensive examination of the product by the platform if the item gets reported damaged.
• Quicker returns on wrong or damaged products would calm the buyer’s frustration.
• Concessions in the form of covering customers’ shipping costs or a monetary refund for those who wish to return the goods.

Amazon Seller A-to-Z Guarantee: What to Consider

The seller now has 48 hours to respond to the buyer’s request for a return under the A-to-Z guarantee. The customer can not complain about the product without requesting a return. 

Does it influence sellers? 

Sure thing! The innovation was aimed to reduce the number of false claims. Under the A-to-Z guarantee, some return requests are approved by Amazon automatically, and some go to the seller. You can check the entire communications history on the Manage Returns page.

The seller has the right to change the situation or correct the error, not just watch how Amazon debits their account and the account rating drops.

However, be careful – if you don’t process the application within 48 hours, Amazon will approve the claim and deduct the cost of the order from the account.

In addition, in case of “force majeure” or errors by Amazon, the seller has the opportunity to appeal the “claim.” To do this, you must file an appeal at this link ⇒ (must be logged in to Amazon SellerCentral)

When can sellers use the A-to-Z guarantee? 

The platform introduced an A-to-Z guarantee to protect buyers’ rights when it comes to the Amazon third-party seller return policy. And here are the cases in which you can use it:

• The goods arrived three calendar days after the last scheduled delivery date or 30 (or more) days after placing the order;
• The received goods are damaged, defective, missing parts, or incorrectly classified;
• If the buyer returned the goods to the seller but did not receive a refund from him;
• Seller did not accept the refund request as stated in Amazon’s refund policy;
• The buyer wants to return the international parcel, but the seller did not provide a prepaid label, return address, or a full refund without the need to return the goods;
• The customer believes that they overpaid when ordering the product.

And note: the list does not say anything about “the product has stopped liking me” or “the product is fine, everything is as I ordered, but I no longer need it.” In such situations, it is up to you to decide whether or not to make a refund. Still, sometimes it is better just to return the money than to argue over A to Z claims.

The first and foremost recommendation to combat A-to-Z claims is to check the product description. It must be as true, accurate and avoid divergences. Do not rush to saturate the listing with keywords. It is better to check again and again the accuracy of the description of the product and its image. Pay special attention to the conditions of use and characteristics – very often. The problem lies in these details. 

Recommendations from SageMailer

Here’s how to respond to this innovation in the A-to-Z guarantee claim policy:

• Enter the procedure for checking the Manage Returns page in your daily tasks to maintain the seller’s account;
• Create standard response templates for return requests. For example, if the reason for the return is the wrong size or color, tell the customer about the variations of the product and help choose the right size and color;
• Take care of your seller rating, even in cases of product returns. Be extremely polite: apologize for the inconvenience and offer a discount on future purchases.

Additionally, we recommend watching a video from Amazon Seller University, which details the principles of the A-to-Z warranty. This video is from 2017, but even though the interface of Seller Central has changed several times, many points in this guide are still relevant.

Amazon 3rd-Party Return Policy: Is It Possible to Avoid Customer Returns?

Well, at least you can make them as rare as possible. Below are some of the useful pieces of advice that you can do to prevent customer returns from happening:

• Always reply to clients’ questions about your product within a short period. It helps to establish trust with your shoppers.
• Don’t forget to place your return policy in an easy-to-access menu for clients to read. Try not to always modify the Amazon third-party seller return policy, even to please one or two clients. Stay consistent, and customers will respect such an attitude.
• Constantly improve your products and verify the items for the slightest damage. Even very small stains or scratches will likely be noticed, and shoppers will return the goods.
• Always check if your packaging is good enough. Use the proper shipping materials or control the process if you’re working with Amazon custom fulfillment as a seller.
• Ensure that all product listings are accurate and contain the necessary details. The more information about the goods you provide, the less misunderstanding the customers will have.
• Specify complete recommendations and instructions on how to use your items. The simpler this process is for the client, the more likely they won’t return the products.

Final Thoughts: Amazon Return Policy

Understanding policies on returnable Amazon goods make operating the business much easier. Sure, you aim to sell the best goods that the clients will love; however, returns will always happen. At this point, you need to decide how to make the client happy again. In addition, such policies and guidelines on returning items to Amazon help delve deeper into how refunds, returns, and reimbursements function.

As an Amazon seller, your tasks are many. Though, if handled properly, your company could grow rapidly. It’s not about the product alone. And it’s also about the service and communication with clients. Avail yourself with an opportunity to make your customer review management easier with SageMailer. Use it to request feedback, communicate with the customers, and drive sales at the end. Go, and make great things happen!