Uncovering a Potential Issue with Amazon’s Return Process and Reimbursement Policy Changes
Hello fellow sellers,
I wanted to bring to your attention a serious and potentially widespread issue I’ve encountered with Amazon’s handling of customer returns, and I’m curious if anyone else has experienced something similar.
The Issue:
I have automated removals set up for returned items in my Amazon Seller Central account, which means that any unfulfillable or damaged items are supposed to be returned to me on a weekly basis. Despite having this system in place, I have encountered several instances where it hasn’t worked as it should.
Here’s what happened: I noticed that several items returned by customers were initially labeled as "Customer Damaged." However, within just 1-2 days, these items were reclassified as "Vendor Returns" and were subsequently removed from my inventory. What’s particularly concerning is that no removal orders were created for these items, which raises significant questions about the handling of these returns. I reached out to Amazon Seller Support for clarification, and their response was alarming. They informed me that the items were "too damaged to be graded," and therefore, the decision was made to liquidate them.
What’s more troubling is that these items were not labeled as "liquidated" in the system; instead, they were marked as "Vendor Returns." This reclassification seems to have been done to conceal from me that my items were liquidated. According to Amazon’s processes, labeling returns as "Vendor Returns" should correspond with a removal order, yet no such removal order was created. This indicates that Amazon may have improperly labeled these items to avoid the transparency and accountability that would come with proper liquidation reporting.
Policy Discrepancy and Lack of Transparency:
From everything I’ve reviewed, Amazon’s FBA policies do not grant them the authority to unilaterally decide to liquidate returned items without first offering the seller the option to have those items returned or properly notifying them. According to the FBA inventory management guidelines, any unfulfillable items should either be returned to the seller or disposed of according to the seller’s preferences. In this case, the reclassification to "Vendor Returns" without a matching removal order suggests an intentional deviation from standard policy, raising significant concerns about the integrity of the process.
This situation raises several critical questions:
Why were these items not labeled as "liquidated" if they were deemed too damaged to return?
Why was I not notified of the decision to liquidate?
Why were the items reclassified as "Vendor Returns," a classification that seems to have no clear basis in Amazon’s policies?
Why were no removal orders created for these items despite my automated removal settings?
Previous Case of Reimbursement for Similar Issue:
What’s even more puzzling is that on April 9th, 2024, I received a refund of $210.63 for a similar issue. The reason given was "Customer Service Issue," and it involved a nearly identical situation where returned items were mishandled. The precedent clearly demonstrates that Amazon has acknowledged the need to refund sellers when returns are not handled properly. Why then, in this current situation, is Amazon avoiding responsibility?
Why This Matters Now:
This issue comes at a particularly concerning time. Amazon is in the process of changing its reimbursement policy, reducing the timeframe for requesting reimbursements from 16-18 months down to just 2 months. This drastic reduction in the claim window, combined with the opaque handling of returns like mine, raises serious concerns about Amazon’s internal processes and the potential impact on all sellers.
Call to Action:
Has anyone else experienced a similar reclassification of returns from "Customer Damaged" to "Vendor Returns" without proper notification or reimbursement?
Do you feel that Amazon’s recent policy changes could be contributing to these issues?
What steps have you taken to resolve these kinds of discrepancies, and how have they been addressed by Amazon?
This isn’t just about individual reimbursements—it’s about ensuring that Amazon’s processes are transparent and fair for all sellers. If you’re seeing similar issues, I encourage you to share your experiences here. Together, we can push for more accountability and clarity in how our returns are handled.
Looking forward to hearing your thoughts and experiences.
Uncovering a Potential Issue with Amazon’s Return Process and Reimbursement Policy Changes
Hello fellow sellers,
I wanted to bring to your attention a serious and potentially widespread issue I’ve encountered with Amazon’s handling of customer returns, and I’m curious if anyone else has experienced something similar.
The Issue:
I have automated removals set up for returned items in my Amazon Seller Central account, which means that any unfulfillable or damaged items are supposed to be returned to me on a weekly basis. Despite having this system in place, I have encountered several instances where it hasn’t worked as it should.
Here’s what happened: I noticed that several items returned by customers were initially labeled as "Customer Damaged." However, within just 1-2 days, these items were reclassified as "Vendor Returns" and were subsequently removed from my inventory. What’s particularly concerning is that no removal orders were created for these items, which raises significant questions about the handling of these returns. I reached out to Amazon Seller Support for clarification, and their response was alarming. They informed me that the items were "too damaged to be graded," and therefore, the decision was made to liquidate them.
What’s more troubling is that these items were not labeled as "liquidated" in the system; instead, they were marked as "Vendor Returns." This reclassification seems to have been done to conceal from me that my items were liquidated. According to Amazon’s processes, labeling returns as "Vendor Returns" should correspond with a removal order, yet no such removal order was created. This indicates that Amazon may have improperly labeled these items to avoid the transparency and accountability that would come with proper liquidation reporting.
Policy Discrepancy and Lack of Transparency:
From everything I’ve reviewed, Amazon’s FBA policies do not grant them the authority to unilaterally decide to liquidate returned items without first offering the seller the option to have those items returned or properly notifying them. According to the FBA inventory management guidelines, any unfulfillable items should either be returned to the seller or disposed of according to the seller’s preferences. In this case, the reclassification to "Vendor Returns" without a matching removal order suggests an intentional deviation from standard policy, raising significant concerns about the integrity of the process.
This situation raises several critical questions:
Why were these items not labeled as "liquidated" if they were deemed too damaged to return?
Why was I not notified of the decision to liquidate?
Why were the items reclassified as "Vendor Returns," a classification that seems to have no clear basis in Amazon’s policies?
Why were no removal orders created for these items despite my automated removal settings?
Previous Case of Reimbursement for Similar Issue:
What’s even more puzzling is that on April 9th, 2024, I received a refund of $210.63 for a similar issue. The reason given was "Customer Service Issue," and it involved a nearly identical situation where returned items were mishandled. The precedent clearly demonstrates that Amazon has acknowledged the need to refund sellers when returns are not handled properly. Why then, in this current situation, is Amazon avoiding responsibility?
Why This Matters Now:
This issue comes at a particularly concerning time. Amazon is in the process of changing its reimbursement policy, reducing the timeframe for requesting reimbursements from 16-18 months down to just 2 months. This drastic reduction in the claim window, combined with the opaque handling of returns like mine, raises serious concerns about Amazon’s internal processes and the potential impact on all sellers.
Call to Action:
Has anyone else experienced a similar reclassification of returns from "Customer Damaged" to "Vendor Returns" without proper notification or reimbursement?
Do you feel that Amazon’s recent policy changes could be contributing to these issues?
What steps have you taken to resolve these kinds of discrepancies, and how have they been addressed by Amazon?
This isn’t just about individual reimbursements—it’s about ensuring that Amazon’s processes are transparent and fair for all sellers. If you’re seeing similar issues, I encourage you to share your experiences here. Together, we can push for more accountability and clarity in how our returns are handled.
Looking forward to hearing your thoughts and experiences.
0 replies
Seller_Qbd0RsfZFEZBY
The whole "Customer Damaged" policy is a conflict of interest at best, malicious at worst.
How would anyone know if the item was damaged by the customer OR in transit
Of course for customer damaged there is no reimbursement, but for carrier damage there is....
Seller_Qbd0RsfZFEZBY
THis has not been my experiance.
My experiance is that the refund process is highly automated and while the customer gets a "refund at first scan" if the tracking data never shows delivered back to you then the refund is reversed.
Of course we use a service to audit Amazon which has netted us ~14k and ~300 units YTD...Check it out
Seller_Qbd0RsfZFEZBY
Okay, lets work through this together. Below I have screenshot my FBA returns. THere is data for the reason for the return, the status and the result along with dates for events. When a customer initiates a return they get there money and have to send the item back. Some are "customer damaged" and those get returned to me. Some are returned to inventory and some are reimbursed. SO where is the loss?
Seller_KAtrS2VELPMAs
I thought you were going to talk about an email I've received twice recently titled "Your unfulfillable inventory is at risk of disposal".
Of course in panic mode I go to our settings to make sure everything's fine and it is set to return inventory back to us. I created a case with seller support asking why I keep getting this email and to please look if I'm missing something?
Their email reply was "Hello from Amazon Selling Partner Support,
As per your email, we understand that you received an email regarding unfulfillable inventory is at risk of disposal. Upon investigation, we found that your all unfulfillable inventory will be return to your address."
I let them know this is a scary email to receive. I'm glad to know everything looks fine on our end, but I hope I don't continue to receive it.
Thank you for sharing your experiences.
Seller_WtOwWhtSrFjva
Been there.
Reported it.
Forgot what I was told.
When you are on FBA you are at the mercy of people who don't care and probably don't know anything about what you sell.
Grin and bear it or get off FBA like we did.
Seller_I9VhpeuVrEsmU
Hi esthered,
I fully understand your post and have experienced the exact same issue. I have over 19 years of Amazon experience and am an expert at navigating the reports and losses. This issue began in approximately October 2023.
One thing that you failed to mention in your post is that Amazon actually charges you a disposal fee for those units that should have been returned to you. If you go to 'Payments' and then select 'Reports Depository' and select report type 'Transaction' for the appropriate date range,, when the giant report is generated, you can filter column 'F' Description to FBA Removal Order: Disposal Fee . There you will see your account debited a Disposal Fee for the product that should have been returned to you on a removal order because your automated removal settings for 'unfulfillable' is set to RETURN and NOT to Dispose. The FNSKU and date of the disposal fee with directly correlate to the demonstrably false 'Vendor Return' in the FBA ledger which has no corresponding removal order for RETURN or for DISPOSAL.
So, you are losing the product because it is not being returned to you, and they have the audacity to charge you a disposal fee. You are 1000% correct at what you are seeing. Only the tiniest fraction of Amazon sellers can follow the bread crumb trail for this phenomena. The very largest Amazon sellers that have discovered this and even pay for to have a dedicated escalation path cannot get reimbursed for these events.
I agree with you that it is horrifying that a seller can have automated unfulfillable removals enabled and set to RETURN , and Amazon can show it as a Vendor Return on the FBA ledger, but there is no corresponding Removal order ID that will demonstrate it was ever shipped back to the seller. To add insult to injury, you can find a FBA Removal Order: Disposal Fee which directly correlates to the FNSKU and Date of the alleged 'Vendor Return' which was never returned to you.
You will get three different explanations from Seller Support (and any of the three explanations is unacceptable). Sometimes they say they liquidated the item because it was "too damaged to be graded," Sometimes they will insist that the unit was returned to you and even provide a removal order ID, but the removal order ID they provide is for the same sku, but originated from a different FBA customer return and not the unit that disappeared. Sometimes they will admit to disposing of the item and say that the item was unsafe to be handled by Amazon associates and their carriers (even if there is nothing about the nature of the product that could be a safety issue) .
I know a few big sellers , 200 mil / year+ that have been trying to get resolutions from Amazon for months on the scenario you described to no avail.
I have never posted on the forums in over 19 years, but I felt compelled to reply to you because there are very few sellers in the world that would ever notice this activity in their seller account. All the replies you have gotten from other sellers aren't addressing your concern, but venting about other Amazon issues.
I have occasionally been able to win one of these cases and get a reimbursement, but it is so rare that I stopped asking. You can't win the case when Amazon is the Judge and the Jury. and the Judge can't even follow the trail of evidence.
I cringe every time I see a unit vanish with a demonstrably false 'vendor return' ledger entry and a corresponding debit for FBA Removal Order: Disposal Fee . I have worked with the Amazon Technical Account Management team on issues like this and hit a brick wall almost every time.
Best of Luck
Seller_cmBuF4ot8lKP1
I believe the reason it is hidden is because Amazon resells these items by the truck loads to "Bin stores" Where customers go and buy items as low as $1. As someone else stated, they charge sellers a disposal fee, then still turn around and resell the merchandise again at a lower rater. It's a win, win situation for Amazon no matter what. Every time I go into one of those stores it's mostly Amazon items and half of the time the package was never even opened.
Seller_kPsgE9cDZSpjF
Since Amazon is customer-facing, and gives little crap about 3rd party sellers, it makes sense for them to refund the customer at the first scan and take their return reason as a valid one.
Remember, humans are looking at these returns and they are not versed in your products as they look at literally millions of items a day. These returns sit at the FC warehouses while they are reviewed, and there is always the possibility for them to be ruined more, shuffled around, broken, etc. During this process, the returns may shift status until finalized. Example, Disposed of, Liquidated, reimbursed, etc. So mistakes and reversals of decisions are expected. Again, they are human. It is a part of the LPN process. When Amazon identifies an item as unsellable for any reason, it goes into the "reserved" inventory until whoever at the FC warehouses can look at the returns and properly classify them. This process usually can take up to 60 days depending on when the customer returns the item, and how busy the warehouse is. Frustrating, I get it!
Usually, if a seller is persistent seller support will give in and provide a " customer service issue" refund, or if there is a final decision where the buyer has defrauded Amazon and the seller, they will take the hit and refund the seller. With FBA, you have to just accept this is the way that Amazon runs things.
TaylorR_Amazon
Hello @Seller_HOnFksWPyIQA8, I would like to look into your situation.
In the meantime, I want to confirm a couple of things. Can you provide the case IDs you have opened with Seller Support? I can get the ASINs and other relevant information from there.
Have you disabled Liquidations from your Automated unfulfillable settings?
- Immediate removal is the default schedule for Liquidation.
- If you have liquidations enabled, you will not be able to place manual removal orders for your unfulfillable inventory.
- If you select immediate removal, unsellable customer returns will be disposed of at Amazon’s earliest discretion based on capacity, including immediately after returns evaluation.
- Items that are immediately removed will be reported in the FBA Customer Returns report. Immediate removals will not be available in the Removal Order Detail Report.
Thank you for the detailed post.
Seller_kZvm6BR3doXxX
I would very much like to konw how to identify if this has happened to me. I am also very puzzled as to why I am being refunded for warehouse damaged goods to the tune of much less than they are worth, and why I am being charged foir items that aren't delivered when they are FBA?
When I buy shipping with amazon and the customer claims it wasn't delivered, I don't have to refund iut. But if it is sent via FBA and the itme isn't delivered, I have to pay for that?
