As a Amazon Vendor, you will likely have experienced an Amazon Vendor Chargeback at some point. These fees can be costly and damaging to your business, but with the help of our chargeback audit and recovery service, you can get your money back up to 3 years later!
Amazon Chargebacks - did you know?
- There are 100 different chargebacks or deductions
- 90% of deductions can go unnoticed in your Vendor Central Account
- Estimate $5,000 lost for every $100,000 in revenue generated through Amazon
beBOLD's Amazon Vendor Chargeback Recovery Service
Our Amazon Vendor Chargeback Recovery service provides a solution to help eliminate lost profits and can recover up to 93% of profit leakage across several years of transactions.
- An automated accounting platform that analyzes up to five years’ worth of accounting data to find errors in claims and identify duplicate billing and chargeback
- Automatically reporting errors and recouping funds back to the vendor
- Providing vendors full transparency into findings during auditing and reconciliation
- Course correcting recurring issues, enabling vendors to maximize future profitability
- No upfront costs and are available based on a percentage of recovered funds
Our Amazon Vendor Chargeback Fees solution extend to three key categories:
- Dispute Management
- Financial Operations
- Financial Planning
Dispute Management: Protects vendors from missing the opportunity to dispute transactional entries from both payables and receivables and allows them to initiate disputes and recover unwarranted deductions seamlessly.
- This solution is an integration of the full spectrum of dispute management tools to ensure timely disputes and recover missed revenue.
- Dispute Management aids with overbillings by Amazon and shortages claims.
Financial Operations: A fully automated solution that significantly reduces the number of resources required to 0.25 FTE (full-time employee).
- This solution provides vendors with precise, accurate, and timely reports that only need to be reviewed by the vendor.
- Financial Operations solutions help manage invoices, cash applications, operational chargebacks, and itemized shortage disputes.
Financial Planning: Infuses AI predictive insights and advanced analytics through machine learning to help vendors make smarter business decisions and drive future-ready performance.
- This solution provides insights into drivers of revenue and profit and evaluates deeply at ASIN/SKU levels to help identify the most profitable business areas so vendors can shift accordingly.
- Financial Planning solutions help create financial scorecards, manage ASIN profitability, and provide ASIN forecasting.
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Understanding Vendor Chargebacks and Their Impact on Your Profit Margins on Amazon
Selling via Amazon's Vendor Center platform is regarded as a prestigious privilege by certain brands. Working with Amazon however is no easy job, as sellers need to meet some specific requirements. These requirements are operational, and failing to comply leads to increased costs on suppliers.
This is known as chargeback. And they kill profit margins on many sellers accounts at Amazon.com. It’s important for vendors to be aware that chargeback is a type of chargeback which is tied to operational metrics and the way to prevent it.
What is Amazon Vendor chargeback?
Chargebacks are fees imposed to Amazon Vendors who do not follow the site’s guidelines. They can be quite hefty too, eating away at your profit margin.
You should never do it. The automation system at Amazon is helping the company grow faster and enhance customer support. Amazons machine learning process is problematic because machines can sometimes be wrong.
But when it comes to amazon vendor chargebacks, we are looking at operational charges and deductions for non-compliance with Amazon's set standards against charge disputes. As we intimated in the preceding section, Amazon's automated framework helps the company to scale faster and enhance its customer service.
The problem with Amazon's machine-driven processes is that machines often make mistakes. And when such mistakes happen, it results in deductions and chargebacks, which place a significant burden upon vendors depending on the chargeback type.
These chargeback fees are not payments requested by Amazon: they are automatically deducted from the vendor's invoice. Thus, the initiative for Amazon to Improve its systems is low.
Provision for Receivables Amazon
Provision For Receivables means a temporary credit memo or access amount that Amazon charges on your account because the anticipated costs due to Amazon may exceed the anticipated payments owed to you.
Part of the Provision for Receivables include Amazon chargeback fees and shortages. In some cases, Amazon may include late fees and other deductions in the Provision for Receivables. This amounts to a noncash charge or an adjustment to your accounts receivable balance on Amazon's books.
Purchase Orders Chargebacks
Amazon is offering a free return on purchase orders if the supplier is not satisfied with their purchase orders. Amazon expects the supplier to deliver the quantity specifications within a reasonable amount of time.
Below are several different chargeback orders which are to be kept under note. So always make sure your prepared shipment matches the total quantity of the initial Amazon purchase order. For this reason Amazon confirms that you have purchased the product or ordered the quantities.
Product Preparation Chargebacks
The chargeback is applicable to suppliers when their products do not meet Amazon's shipment instructions. Amazon obligates its customers to pack, wrap / tape items before they ship in order to reduce the risk of damage in transit.
Packaging will vary depending on the product the manufacturer is selling. So if the product has sharp or fragile pieces or is missing pieces, it should be wrapped tightly with bubble wrap. It may also be possible to pack items in boxes with open boxes, loose parts and openings.
Receive Process Chargebacks
The second litmus test of compliance occurs when the shipment arrives at Amazon. Amazon wants the vendor to automate this process to allow synchronization across the warehouses. If an automatic receipt is failed this can lead to a chargeback.
The chargeback process can be grouped as no PO labels, barcode dunks, no carton contents tags and no cartons. Cartons content correct, enlarged cartons, overweight cartons and expired products. Costs vary in different categories.
Advance Shipment Notification (ASN) Accuracy Chargebacks
ASNs are documents which provide details about pending delivery. ASNs are used as communication channels to notify customers when shipments happen and to provide physical documentation for the package to be ready for acceptance.
Amazon is not liable if your shipment is not received by Amazon fulfillment center. ASN charges back are anywhere from 1% of the product price. The specific ASN issue or your compliance rate determine the cost.
Direct Fulfillment Chargebacks
Amazon charges vendors back using direct fulfillment. This vendor ships orders directly to the end user via the Vendor Central website rather than sending products into Amazon. Below is a list of direct fulfilment chargebacks you need to reduce.
Causes and sources of Amazon vendor chargebacks
Amazon has several reasons for chargebacks and shortages, which can be found below. Understand the methods for avoiding each other.
How do I dispute Amazon chargebacks?
You may contest the decision in case you find a chargeback notification was sent. However, you must have evidence that will prove that you understand it correctly. The supporting documents must be sent via email to Amazon Pay.
In order to sell your product on Amazon, you must have the transaction status at a minimum. There will be many documents to support your request. Those are orders confirmed by email, tracking numbers, or other customer communication data. Typically this process takes about 90 days to decide on an issue.
How to avoid chargeback fees?
If you feel the cost to avoid the chargebacks should have been less expensive, then no pun intended. You have to be confident that Amazon gets the information on the SSN and everything is accurate. However many things go wrong.
After a shipment is prepared, the vendor must verify that the number of units in the shipment reflect what the shipment contains and that each tracking identifier corresponds to the tracking number. If you sell products which have a valid expiry date, this information is also required.
How to recover Amazon Vendor Chargeback and shortages like a pro?
The following section will help you recover Amazon Vendor Chargeback fees and shortages effectively. Get a quick and easy way to recover Amazon fees. The following guides should help you avoid Amazon's chargeback recovery.
Always keep excellent documentation of each shipment
Even if Amazon's automated systems have made commerce easier, both by vendor or company, they are not perfect in every regard. Some companies incur fees to fix errors they make in technology. And unless that is the case you must prove the deductibility of the money you shouldn't have withheld.
If you lack adequate evidence, you won't get the money that is lost. Keep track of all important shipment details including BOL, NDA, photos, and shipment documents and provide this for all your team to use.
Amazon Vendor Chargeback Fees - Frequently Asked Questions
How do I recover Amazon vendor chargeback fees?
You can recover Amazon vendor chargeback fees through an audit process, which should be conducted to ensure that all charges are accurate and verifiable. This involves conducting a detailed review of your account and its associated orders, examining any discrepancies between what was promised and what was delivered. In certain cases, you may also seek refunds for up to five years of previous charges that were not disputed in the past.
Can I get a refund from Amazon Vendor Central?
Yes, you can potentially get a refund from Amazon if you dispute your vendor chargeback within 90 days of the chargeback being issued. Additionally, Amazon’s Voluntary Refund program may also help you to recover losses due to chargebacks for up to five years worth of historical charges. This program is designed to encourage vendors to cooperate with Amazon during vendor chargeback audits and dispute resolution processes.
What are Amazon Vendor Chargeback fees?
Amazon charges back the merchants if they don't comply to their requirements relating to packaging and/or shipping.
How to Amazon dispute chargebacks?
We want to respond within 12 business days to ensure that payment is made in time for payment of credit card debt. If we can't reply within 11 days we won't challenge the charge - and your account is debited with the refund.
Vendor Central Chargeback Fee Recovery Service by beBOLD
No one likes to be charged a fee by Amazon, but it is something that happens from time to time. If you do find yourself in the unfortunate situation of being charged a Vendor Chargeback fee, don't despair!
With the help of a chargeback audit and recovery service from beBOLD, you can get your money back up from up to 5 years ago. So if you've been hit with an Amazon Vendor Chargeback fee, contact us today for a free audit of your account- we may be able to help you get your money back!