Amazon FBA Explained

What is FBA?

FBA is short for Fulfillment by Amazon. Through this program, sellers can let Amazon handle the fulfillment of customer orders and make items eligible for Prime shipping.

A seller ships products to Amazon, which takes care of:

  • Storage
  • Packaging
  • Shipping
  • Customer returns

Fulfillment by Amazon (FBA) FAQs

As a seller, how much does it cost me to use FBA?

You’ll pay three main fees when you use FBA:

  • Fulfillment Fee – A fee paid for each customer order based on dimension and weight categories and updated each year in February.
  • Storage – A fee paid on the average square footage your products take up in Amazon warehouses each month.
  • Commission – A fee paid for each order as a percentage of the total price of the unit sold. The percentage is based on the product category, and all Amazon sellers pay this, even if you don’t use FBA.
What can I do if Amazon makes an error with my FBA account?

Mistakes happen, even at Amazon. It’s a good idea to keep a close eye on your FBA account to ensure you’re reimbursed when Amazon does make an error.

There are dozens of errors Amazon could make with your FBA account, as listed below. Those in bold are the most common and are the errors you are most likely to get reimbursed for.

Inbound Shipments
  • Shipment gets lost.
  • Shipment arrived with damaged units.
  • Incorrect products received.
  • Incorrect number of units marked as received.
 
Inventory
  • Inventory units are damaged/destroyed.
  • Inventory units are lost.
 
Dimensions & Fees
  • Incorrect referral fee charged (including based on a product being classified in an incorrect, higher referral category, such as Office Products rather than Electronics.)
  • Incorrect fulfillment fee charged (based on the current recording of the product’s packaged dimensions or weight).
  • Monthly storage fees.
  • Long-term storage fees.
  • Incorrect specs.
 
Customer Returns
  • Customer refunded an incorrect amount.
  • Customers are incorrectly allowed to initiate a return after 30 days.
  • Return arrived after 45 days
  • Return never arrived.
  • Returned product arrives in a non-new condition.
  • Customer returned an incorrect product.
  • Returned product not added to inventory.
  • Return refund not received.
 
Seller Support Issues
  • Refund request declined due to Amazon Seller Support representative error (such as misunderstanding the relevant Amazon policy or the facts of the case).
  • Granted refund not received.
  • Unfair reimbursement values.
How much do Amazon FBA errors cost me?

FBA sellers are usually able to recover hundreds or thousands of dollars in reimbursements from Amazon errors — when they’re able to find the errors, dispute them, and submit them as a case.

It’s a lot to manage on top of everything else you have to do. But that money is yours, not Amazon’s.

If you’re looking for help tracking FBA errors and getting your money back, Amazon Audit is a simple tool that has worked for thousands of sellers like you. Learn more.

If you’re looking for help tracking FBA errors and getting your money back, Amazon Audit is a simple tool that has worked for thousands of sellers like you.

Amazon Audit FAQs

I am handling some of these errors myself already. Why do I need this service?

While you may be able to go after some of the error types yourself, we know how to go after them all. Our software downloads data every day from your Seller Account to continuously look for Amazon’s mistakes so our team of experts can submit the cases on your behalf.

Our roots in Amazon go back to the beginning of third-party selling, and we have been involved in the FBA ecosystem since 2009.

What access do you need?

We need two points of access:

  • API/Developer Access (to download reports daily)
  • Limited guest access to Seller Central (for our Operations team to submit and track cases in the Seller Support Case Log)
How do I get the reimbursements?

When Amazon grants your reimbursement, it will show up in the “Other Transactions” section of the Payments report and get paid out on your normal schedule from Amazon.

How does VeriShip get paid?

We track the reimbursements we secured for your account and invoice you once per month for 25% of what we secured on your behalf.

What is the time commitment for Amazon Audit?

Amazon Audit is a month-to-month agreement.

Is my account at risk if I use this service?

No, we follow Amazon’s Terms of Service and policies when it comes to reimbursement activity. None of our clients have ever had negative repercussions from using our service.

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