Selling on Amazon has provided us with the most amazing opportunity we have encountered: It allowed us to grow and scale our business with minimal infrastructure. For example, in many cases we have over a thousand orders a day (particularly in peak season), but only three full-time employees processing products.
In most circles of the world this wouldn’t be possible, but with Amazon it absolutely is. Amazon FBA allows us to scale without needing lots of employees and crazy systems to do it. I say this because I want to talk about some of the amazing things Amazon has allowed us to do, and use that to transition into something you might not know about:
If you already sell on Amazon, they probably owe you money!
Amazon is an amazing platform and allows unparalleled growth and scalability, but it is not perfect. Amazon deals with MILLIONS of transactions each day, and this creates the opportunity for error. While Amazon is incredibly automated, there is still a HUGE level of human input. Human input is something that can lead to errors.
The great news is: if you know what you are looking for, Amazon will review and issue you a reimbursement. However, many people don’t know what they are looking for and these reimbursements often go unclaimed.
I want to dispel a myth regarding this — this is not intentional, and Amazon is not trying to take your money. Errors happen, and they expect that being responsible business owners we should review and create cases when it is necessary. That generally raises the question of whether this should be automated, and the answer is clearly ‘yes.’ The vast majority of these reimbursements do get applied to your account and are done so in an automated way.
However, there are instances where human errors on the Amazon side cause a fraction of these to fail to be automated. Again, this is not intentional, and is just a part of doing business. You should take advantage of the fact that they allow you to review and appeal, as it can make a huge difference on your bottom line!
We recently did a video with Ryan Grant (the man behind the reimbursements book) that has literally made us thousands of dollars. This video is great and we highly recommend you watch it!
Just to give you an idea of how much money Ryan’s book has made for us (this is just from one account) from 1/1/16 – 12/31/16:
Now, let’s talk about a few ways that Amazon may owe you money, such that you can review and get reimbursed where applicable. I’ve included time-stamped links to corresponding portions of Ryan’s video.
1) Lost or Damaged Inventory
Amazon is responsible for any inventory sent into their fulfillment centers while it is in their possession. This means if a product is lost or damaged while Amazon has it, you are able to be reimbursed for it.
I will preface with the fact that the VAST majority of these are automated and you will find reimbursements for them. That being said, depending on your volume there may be thousands of dollars in missed reimbursements that you are owed for.
2) Customer Returns
Amazon has a very liberal return policy, and as Amazon sellers that extends to us as well. Basically, customers are allowed to return products for any reason. However, there are certain rules regarding returns… like the customer actually has to return the product!
You would be shocked at how many times customers initiate returns and are refunded then do not return the item. Per Amazon’s own guidelines – this is something that you can be reimbursed for. You can see this with the Returns Report.
3) Other Customer Concessions
Amazon loves to make customers happy, so at times they will offer then an extra $20 on their refund or something of that nature. This is done at the discretion of the customer service representative and most of the time Amazon issues this money from their own account.
However, sometimes this can be issued from your account. Amazon does not have the ability to give your money away through Customer Concessions. Only you have the ability to authorize this, and therefore every time this happens, you are eligible for a reimbursement.
4) Inbound Shipment Errors
The Amazon Fulfillment Centers receive thousands of shipments each day, and while it works perfectly the vast majority of the time, occasionally things get lost in the shuffle. It is very important that you monitor this and request reimbursements as they come up.
5) Verifying Customer Exchanges
It is not uncommon that a customer asks to exchange an item, as opposed to a traditional return or refund. The process looks like the refund process, and should similarly be researched. When a customer exchanges an item, they have to return the original but should NOT be refunded in addition to the original return. If they are, you have an excellent case for reimbursement.
6) Customer Returns that Don’t Adhere to Return Policy
Beyond having specified times in which they have to return products, Amazon also has guidelines for the type of returns and the ways customers treat them. For example, customers may not return items in the Grocery category or may not return items that have clearly been used. If they do, you are likely eligible for reimbursement.
7) Warehouse/Distributor/Carrier Damaged Units
These are all non-fulfillable inventory types. In the case of Warehouse and Carrier Damaged you should be reimbursed automatically for those types, and in the case of Distributor Damaged, many of those are cases for reimbursement. The bottom line is: you should review and file as necessary.
Those are just seven of the ways you can rescue lost money. The great thing is that most of these strategies are so simple and so broken down that you can do them in minutes or even outsource them to your assistant team. Our VA team handles this and is able to create cases for these reimbursement opportunities.
Our suggestion is to check out the video here, and potentially check out Ryan’s book. This book has had the greatest ROI of any product that we have ever purchased. If you want to check out more of this information you can do so here:
Hopefully this article helped to open your eyes about some of the reimbursements possibilities that exist. Think of it this way, if you are performing profitably without utilizing these strategies, this is like picking up additional free money to further grow your profits.
They now accept students a couple times a year to teach them The Wholesale Formula, a blueprint of the exact steps they used to build their multi-million dollar Amazon business.