As you all know, I’ve started to dabble into reselling on Amazon. Let’s be clear here; I haven’t just ‘dabbled;’ I’ve dived headfirst into it! I’ve sold over $2,500 worth of stuff and it’s only been 3 weeks. However, things aren’t as rosy as it seems. Seven of those items were through “Marketplace” and the other 5 were through FBA. Here are the issues so far:
Issue #1 – Buyer didn’t want
I had sold a Dyson through “Marketplace” to someone in GA. This stupid Dyson was so heavy (my mistake for buying it in the first place) that it cost me over$40 to ship it down there, and that’s WITH Amazon’s reduced shipping rates. This was a little over a week ago. Then yesterday, the buyer emailed me saying she wanted to return it because it was ‘heavier and not as easy to turn’ as her older Dyson. In this case, because it was buyer’s remorse, the return shipping is on the onus of the buyer. More importantly, this will cost ME $40 because I have to fully refund her when I get it back. I just kept thinking this wouldn’t happen on eBay. I think most people assume that when you buy on eBay, all sales are final unless the item was not as described. However, on Amazon, I think people sometimes confuse Marketplace with Amazon FBA. They just assume that, “Hey, I’m buying it on Amazon, and so I can easily return anything I want,” even with a heavy Dyson. In all my years on eBay, I’ve never had a return on a heavy item. The only returns I’ve gotten are from clothes that weren’t the right size, which is light, and so it’s a minimal margin impact. I mean, seriously, who “test drives” a Dyson from an online store? That’s what brick & mortar stores are for. Make sure it’s the right one you want before buying such a big heavy item online!
Issue #2 – Inventory Confusion
You guys remember I had sold that food processor through Amazon FBA, which subsequently got refunded back to the buyer. I had contacted them to see what happened, but no word back. To make matters worse, I don’t know what’s happened with it since then. Amazon doesn’t give me a tracking or anything on where that item is. It’s like it’s gone into a black hole. To make matters worse, I had sent a 2nd one in that arrived on Thursday evening. I didn’t get an email on Saturday morning that it was processed. However, when I logged on, I see that I had 1 item marked as ‘manufacture defect.’ The confusion comes in because I don’t know if that defect was from the buyer’s return or the brand new one that I sent in. Once again, it’s gone into a black hole.
Conclusion
Oh how I miss my eBay account now. I’m not sure if I’m being taken advantage of since I’m a new Amazon seller, or if this is just one of the drawbacks of selling on Amazon vs eBay. So far, I’m not liking the amount of returns/issues with Amazon. I’m considering removing ‘commingled inventory,’ but not sure if that’ll help. To make matters worse, selling on Amazon is actually more costly than eBay, and once you add in the returns rate, it makes it even less attractive. Maybe it’s time to call up eBay again and beg and plead like an ex-boyfriend who’s realized the grass wasn’t really greener on the other side.
To find out Reason for return:
On your Sellers Account you can Go to: Reports >>Fulfillment>>Returns>> I usually look at returns for last 90 days
The reason for return doesn’t always match up to reality, some people will put defective even though they never opened it. This report will also tell you where your item is currently.
Keep in mind Amazon has a very generous return policy, buyer has 30 days to return stuff, and a 30 day grace period after the first 30 days, giving them a whopping 60 days to return items. Incredibly I had a blender come back to me after 8 months, I dont know what the rep was smoking when he allowed it to be returned, but since it was past 60 days Amazon is suppose to reimburse you automatically (most times I have to request it).
You will also find that sometimes amazon will give a partial refund as compensation for buyer dissatisfaction or buyer having damages as a result of defective product (I have been able to get reimbursed for these upon requests).
You will also find that Amazon once in a while refunds a buyer twice ( again need to request reimbursement).
You will also find that buyers will return items only to find that the blood suckers have stolen parts from your item or they may send you a completely different item(your miles may vary on requesting reimbursements).
I never use Merchant Fulfilled, to expensive for shipping, FBA so cheap for shipping heavy things. 95% of things I sell go through FBA, and Amazon might have higher fees but they can sell for much higher premiums then Ebay. I can sell a tablet on Amazon for $300 and it will go for $260 on Ebay. Your best bet to mitigate fees is to sell electronics which have much lower fees. Open a FBA store if you sell more then $40 a month. Sales tax will be annoying since you have to pay for taxes in your own nexus at the very least.
Find items that are reserved because its sold:
On your Sellers Account you can Go to: Orders >> Advanced Search >>Select date range ( I usually put last 14 days)
Always make sure to reconcile the inventory you sent vs what they received, for some reason 5% of the shipments I send to their warehouse end up missing and me having to request reimbursements.
Thanks for the in-depth reply Nick. In regards to taxes, you mean the 20K/200 rule right? So you think that manuf defect item was from the buyer’s return then? If so, then I have one food proc unaccounted for…
Its most likely from the Return, Amazon wouldn’t know if its defective unless they open the box lol. It may be too soon for them to have sold the blender and for it to have been returned, usually its 4-5 days before they receive it, then up to 6 days after receiving it to become available. It use to be a lot shorter but those days are gone.
When your inventory is either lost or damaged while it is under Amazon’s control (damaged by an Amazon partnered carrier, in the fulfillment center, or during delivery to a customer), Amazon will either:
Replace the item(s) with one with the same FNSKU, or;
Pay you the evaluated replacement value of your lost inventory, less any applicable FBA and Selling on Amazon fees.
I usually check Shipment to see if my item was received first and that there isnt a reconcile issue.
Inventory>>Manage FBA shipments >> under Shipments
Compare Shipped with Received, if these don’t match and its past 5-6 days (amazon lets u reconcile after 3 days but i give them a few extra days otherwise you will have a ton of opened cases) after box was received by the Amazon Fulfillment center then we would need to reconcile it by opening a case with FBA.
Reconcile:
Inventory>>Manage FBA shipments >> under Shipments>> select your shipment >>Reconcile tab >> select an Option (choose an action)
If it was received then check Manage Inventory, and click on the number under available. It will tell you whether its Available, Inbound, Reserved, Unfulfillable.
If its Unfulfillable then go:
Inventory >> Manage inventory >> Remove Unfulfillable Inventory >> then select items to create a removal order.
If its Reserved then go:
Reports >> Fulfillment >> Reserved Inventory >> Request download
In regards to the Tax, the 20k/200 items is the Feds threshold for requiring a 1099 to be sent to you and them. The Feds wont know how much you sold unless they get the 1099 from Amazon. My accountant would tell you that you have to pay taxes on all income regardless of the threshold. Since I have a business on FBA I have to pay sales tax. Some say you only need to pay sales tax in the the state you live in, others say you have to pay sales tax for every state you have a nexus (inventory in warehouses). There is endless debates on this, some people actually register for every state Amazon has a FBA warehouse and they pay sales tax to all of them at the end of the year. Can you imagine registering your business to every state that has sales tax and collect it for each state? Its a nightmare. I only do it for my home state, im not even sure if thats correct lol.
heres some info:
http://blog.taxjar.com/fba-sales-tax-nexus/
Thanks for the in-depth circles and arrows comment there Nick. I REALLY appreciate it. So, I’ve sent 12 blenders to Amazon FBA. 7 of them are on way. The other 5 have been checked in. I sold 1 that was the buyer’s return. I sold 1 that the buyer is keeping (pop the champagne people!). Therefore, I should have 3 as ‘fulfillable’ but I only see 2. There are no reserved and no unfillable (because I had the ‘bad’ one shipped back to me already.) Therefore, Amazon has lost one right?
Are all 12 blenders the same model?
Did they ever receive the missing item? check to see if it was never received:
Inventory>> Manage Shipment>> shipped column and received columns must match up.
check to see if it ended up stranded or suppressed or unfulfillable:
Inventory>> Manage Inventory>> left hand side click through the these tabs: Fixed Suppressed listings, Remove Unfulfillable Inventory , Fix Stranded Inventory
Did you see it under this?
Find items that are reserved because its sold:
On your Sellers Account you can Go to: Orders >> Advanced Search >> Select date range ( I usually put last 14 days)
If it sold recently but hasnt posted it will show up as grayed out
If all else fails click Help on the top right >> Contact US >> Fullfillment by Amazon >> other FBA issue >> Email or phone
If its complicated ill just have them call me.
FBA should really assign every item you sent a unique identifying number.. its hard to keep track of what sold and what didnt. Imagine when an item is sent back to your inventory, they dont tell you this, its done automatically, and if it resells then now you have sold your item twice. I gave up on the granular accounting I just go in at the end of year pick out my totals and subtract from my total costs. lol.
Thanks Nick. I’m going to wait till all 12 blenders have arrived (yes, they are all same model), then shoot them an email asking a reconciliation on where all 12 went.
lol you can also try generating a Inventory Reconciliation Report:
Reports >> Inventory Reconciliation >> enter merchant Skew and set date range
however you probably will need to wait another week or so, sometimes it doesn’t pick up the most recent activity.
an inventory report for an item over the course of a year.
Ugh… I was sort of taking a bead off of your initial FBA efforts before jumping in myself, but this is giving me some serious second thoughts.
I’ll try to write a ‘lessons learned after my 1st month with FBA.’
I was able to sell 2 FBA items today (one of them was the exact same heavy Dyson pictured above), so now I’m happy with Amazon again. haha.
The customer has 30 days to return the item. If it doesn’t arrive amazon will automatically credit you for the product. If it does arrive you will see it in your FBA inventory, either placed back into inventory (If unopened) or marked “unfulfillable” if opened or damaged. Normally in that case you create a removal order and have the item sent back to you or destroyed. When it gets back to you, 9/10 its fine and the customer just didn’t want it. You can send back to amazon FBA as used, or try merchant fulfilled.
Happens. You can/should expect 5% returns
Also, it’s very unlikely that the new item you sent in was the manufacturer’s defect. Did you receive a processing and receiving email from AMZ warehouse that that item was received?
Thanks Jordan. The new item was received, but I wish Amazon had told me it was manuf defective if it was indeed defective (which I doubt.) So that’s why I am unsure if the ‘manuf defect’ was the one that came in or the buyer return. I just need to call Amazon to figure all this out.
Personally it’s always easier for me to contact seller support by hitting the “contact seller support” button and do it by email.
I have a love/hate relationship when it comes to FBA in the past year or so. Can make selling large quantities of small items a breeze to sell, however fees can be higher and if the buyer wants to return the product for ANY reason you are screwed if they already opened it etc.
Mike, I agree. It’s like the love/hate relationship I have with Paypal.
What happened to your ebay account?
Ryan, search for ‘ebay’ on my site. Basically, they banned me for circumventing daily deals limits.