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Returns on Amazon: A Seller's Predicament

Lowell Bieber
Jul 31, 2018 1:22:00 PM

As an online merchant, when you hear the word ‘online return’, it probably makes you cringe more than a little bit. Unfortunately, returns are part of the online shopping lifecycle, and as such they’re a bit of a thorn in many seller’s sides. While the financial implications of a return are, of course, one of the most important areas of focus for sellers, there are also logistics implications to deal with. If you’re selling your products on Amazon, these logistics details are bound to increase tenfold. In this article, we’ll look through some of the main parts of the Amazon seller returns continuum and share how sellers can work to ease some of the overarching predicaments at every step of the journey.

Understanding Returns on Amazon
To truly understand how returns on Amazon impact sellers, it’s important to first understand how Amazon itself handles returns and refunds. As a megalithic e-commerce retailer, Amazon makes it ‘easier’ for customers by handling all FBA returns itself. This means that if a customer returns something through Amazon, it goes directly to the Amazon warehouse, and in most cases the seller isn’t even notified of the return. In case of a refund, Amazon just credits a seller’s account and handles the entire transaction in-house. Sellers have little insight into their returns except for an automated email (that thankfully includes the reason for the return) which makes metrics pretty hard to track in the long-run.

For non-FBA sellers, the process is even more convoluted. Amazon passed a new returns policy in 2017 that puts non-FBA sellers in the same category as FBA sellers, giving Amazon more control over the returns lifecycle. Amazon even allows buyers to download prepaid shipping labels which are then credited against a seller account at the end of a billing period. Products are still returned to the seller’s warehouse, but the insight (and refunds, if applicable) are handled by Amazon. This lack of insight has led many Amazon sellers to turn to third-party Amazon sellers to track and manage these metrics without having to waste manual resources or time.

What to do with Online Returns
When it comes to dealing with returned merchandise on Amazon, knowing what to do with products after they’re returned can cause roadblocks for many sellers. If you’re an FBA partner, Amazon handles most of these actions, but once again, there is little insight into what is actually happening until further down the line. If you’re a non-FBA seller, you have more freedom of what do with returns once they arrive back in your warehouse. Many sellers choose to automate this step of the process and dispose of any unused or un-repurposed products after a set time period, usually between 30 and 60 days. Depending on the quality of the product, you can decide to repurpose or resell as ‘used’ back on the Amazon platform. Whatever your team decides, just make sure to properly label and track returns within your larger onsite stock. This will provide more insight and direction into your returns strategy moving forward.

Turning Returns Into a Customer Win
One often-overlooked part of the Amazon returns lifecycle is the post-return customer follow-up. One reason that online sellers are so returns-adverse is that a trend of returns can often translate into a string of negative customer reviews or a slew of poor seller ratings. While Amazon has certain policies in place that make it hard for sellers to communicate directly with buyers, the returns process is one place where this communication is encouraged. Brands receive a notification when an item is returned and can follow up with the customer directly. For brands looking to escape the ongoing ‘stress cycle’ of returns, this is a great place to get customer feedback and help boost brand reputation. Communicating with customers directly is a great way to smooth over any negative feedback or comments before they go public on your product or seller homepage.

Make Amazon Returns a Breeze
Just because returns are confusing and stressful doesn’t mean that you can’t overcome the ‘seller’s predicament’. With a dedicated third-party seller partner like SupplyKick, your team can gain insight into previously convoluted processes – whether you’re an FBA partner or non-FBA seller – to better form a well-rounded returns strategy. SupplyKick also helps teams understand why customers are returning products and works to ensure seller credibility and reputation stays in tact

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