FBA Reimbursements: What is the "3R Cycle" on Amazon? Let's Talk About the Refund, Return, and Removal Process.
As you know, selling on Amazon using FBA Logistics certainly has a number of advantages, but it's definitely not without complexity. One example is certainly managing what we at Eagle Eye Software have called the R3 cycle: Refund, Return, and Removal.
Understanding this complex process is essential to keep your Amazon business efficient, meet your end customers' expectations, and properly manage returns in order to lose as little cash as possible.
In this blog, we'll explore each of the three Rs, providing a detailed guide to help you navigate this process.
"R" for Refund
The refund is the first thing that happens in the R3 Cycle: when your customer is not satisfied, they can easily and quickly request a refund. The money is reversed from your Seller Account and held "on hold". Usually, the customer must then send your product back to Logistics as a Return to receive their money.
However, Amazon has introduced the concept of "returnless refund" for some specific cases: in this case, the end customer will receive the refund and the related money without having to return the product to Amazon logistics.
The reasons behind this logistical simplification are multiple, not least the continuous growth in management costs that Amazon has faced in recent years.
How Returnless Refund Works
What are the specific cases in which Amazon grants a Returnless Refund?
- Customer Evaluation: Amazon uses an algorithm to determine if a customer is eligible for a returnless refund. This is based on their purchase history and the frequency of the customer's refund requests.
- Product Evaluation: the nature of the product plays an important role. Products of low economic value or very expensive and difficult to manage logistically may be eligible for this type of refund.
- Unilateral Decision: Amazon can finally make the decision to grant a returnless refund unilaterally, without the possibility of appeal by the Seller.
Problems that can arise in this "R" and for which you may be entitled to a reimbursement:
- You can request a reimbursement from Amazon when the end customer - after requesting a refund - is required to return the product - but doesn't!
Let's now see together what happens if Amazon expects the Customer to return the product to Logistics.
"R" for Return
The return is the second step in the 3R Cycle and by Return we mean the return made by the end customer that will see the product return to our Seller Inventory. Before this happens, however, Amazon performs certain steps and checks, as well as initiates an evaluation process to determine the product's status and subsequent actions to take.
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Product Condition: Amazon evaluates whether the product is in sellable or unsellable conditions (or in other terms: manageable inventory and unmanageable inventory). Manageable inventory is re-inserted into the Seller inventory and is available to meet new customer orders. But what happens to unmanageable inventory?
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Unmanageable Inventory: in this case the product could be: 1) refurbished 2) resold 3) liquidated 4) removed.
The process in this context is highly automated, but as a Seller you must still pay attention that no errors occur in order not to incur losses of money or useful merchandise.
Problems that can arise in this "R" and for which you may be entitled to a reimbursement:
- You can request a reimbursement from Amazon for items returned in damaged condition by the customer
- You can request a reimbursement from Amazon for items returned outside the designated time window
- You can request a reimbursement from Amazon for return of an incorrect item (SWITCHEROO) by the customer
- You can request a reimbursement from Amazon for refunds that exceed the amount paid by the customer
Unmanageable inventory is very often removed... as we now see in the third step of the R3 cycle:
"R" for Removal
The removal process of unmanageable inventory on Amazon FBA is very complex and involves several steps and actors.
First of all, keep in mind that - as a Seller - you can set automatic removal options for unsellable products. This includes destruction or return to the Seller's warehouse.
When a removal order is created by the Seller or by Amazon, it can be divided into multiple removal shipments, each of which can depart from different distribution centers and handled by various carriers (such as Amazon, SEDA or Bartolini). Each shipment has its own tracking number and can arrive at different times in the seller's warehouses.
A critical aspect that often generates errors in this process is Amazon's logistical optimization, which decides how many units will actually be removed based on various factors such as the location of goods and fleet availability.
This can lead to situations where some units are not removed, creating confusion among sellers who might think the units were actually lost.
Problems that can arise in this "R" and for which you may be entitled to a reimbursement:
- You can request a reimbursement from Amazon if some or more removal orders and related shipments were not delivered
- You can request a reimbursement from Amazon if all units expected in the removal order shipment were not returned
- You can request a reimbursement from Amazon if the removal order products arrived damaged or incomplete
Get Your FBA Reimbursements Effortlessly
As you can well understand, the problems that can arise throughout the R3 Cycle process are multiple. Do you really have the time to check everything and especially to lose precious energy and focus with Amazon Support to get the merchandise or money you're entitled to?
Wouldn't you rather have a service that allows you to receive all your FBA Reimbursements credited to your Seller Central balance, without having to waste time arguing with Amazon Support?
Eagle Eye Software's FULL SERVICE can make the difference. While we find every Amazon error and successfully request all FBA Reimbursements for you, you'll be free to prioritize more strategic activities for your business.
After all, sifting through months of data and wasting time on burdensome activities is something most entrepreneurs hardly have the time and desire to do.
What's the advantage of fully relying on our FULL SERVICE?
- We've been leaders in Italy in FBA Reimbursement recovery for over 2 years
- Our level of expertise and framework with which we operate is unmatched
- Our software will identify all discrepancies and FBA Logistics errors
- Our Team is made up of former employees who were part of Amazon Support
- You'll be given a WhatsApp group entirely dedicated to your FBA Reimbursements
Still not convinced? We'll give you the first month of software for free and, in addition, we'll give you the first €100 of FBA Reimbursements: it costs you NOTHING to join, in fact you only gain!
Click below and book 10 minutes of call WITHOUT OBLIGATION:
