Amazon Vendor Central Chargeback Explained

Why does Amazon Deduct from My Payments

This is the question many suppliers ask when they see the Remittance advice from Amazon. There will be many deductions in the total amount paid. Understanding the reasons for these deductions will help to avoid the charges and improve overall profitability.

Reasons for Amazon ChargeBack

There are many categories under which amazon will add chargeabck to a payment. The categories as below

Shipments Fulfillment ChargeBacks

 These charges are due to the actual date of fulfillment of the supplies.

1. Shipments outside the ship window :  If the supplier ships after the ship window, then it will lead to charge back upto 10% of the cost of the product.
2.  No Delivery Cancellation : If the order is not delivered within the delivery period and the order was not back ordered earlier, Amazon will cancel the order and chargeback the supplier for delivery compliance.
3. Routing Request : For collect orders (Amazon pays the shipping charges), Suppliers are supposed to create routing in advance. If they fail to create the routing request, or if the collect date is outside the ship window, it will lead to No routing request chargeback

 Shipments Label Issues

1. No PO on Carton Label : Each carton label should have the PO number printed on the label. If not, Amazon will chargeback for this
2.  Expired Product : The product has expired or close to Expiry
3.  No Barcode on the product : Each product should have barcode
4.  No Label on Carton : Amazon expects each carton/container to have barcoded label pasted on the box. If the label is missing or not scannable, Amazon will charge each carton for the missing labels

Advance Shipment Notification (ASN) not created in Advance

1.  ASN Not in Time:  If the supplier does not submit ASN within two weeks of Receipt of the Shipment, charges will be added for No ASN.
2. Late ASN : Vendors are expected to create Advance Shipment Notification (ASN) to Amazon either in Vendor Central or through EDI before the shipments reach Amazon's Fulfillment Center (FC). If not, Amazon will charge Late ASN fee. This can be $5 for Small parcel shipment and $150 for Less than TruckLoad (LTL)

Packaging Related Chargeback

 
Bagging, Boxing, Bubble Wrap, Stuffing , Taping issues can lead to charegback.

Avoiding The Chargeback

Processing Amazon orders in time, providing correct labels on the packages and creating Advance Shipment Notification in time are the keys to avoid chargebacks. Using a good EDI system like TPSynergy EDI will automate the order processing with Amazon. Using an EDI system to acknowledge orders in time, create Advance Shipment Notification (ASN) can help to avoid chargeback situations.