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by Refundget

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Categories: Blog

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amazon fba lost inventory

If you’re an Amazon seller, chances are you’re familiar with the perks of Fulfillment by Amazon (FBA) – the convenience of having your products stored in Amazon’s fulfillment centers, with Amazon handling the challenges of order fulfillment. Yet, amidst the ease of this arrangement lies a common headache: Amazon FBA lost inventory. 

Whether it’s items getting lost during transit or getting misplaced within Amazon’s vast network of warehouses, dealing with lost inventory is a challenge many FBA sellers encounter. 

The question is “how to get reimbursed for Amazon FBA lost inventory?”

What is Lost Inventory?

Amazon FBA lost inventory refers to the disappearance of a product from your inventory stored within Amazon’s Fulfillment Centers. This loss can stem from various factors, including damaged or misplaced items, inventory inconsistencies, or even theft. 

However, the repercussions of lost inventory can significantly impact a seller’s financial performance. Fortunately, sellers have the option to seek reimbursement from Amazon for lost inventory occurrences.

Why Does Lost Inventory Happen?

There are multiple reasons why your inventory might disappear during the FBA process:

  1. Damaged Items: If an item sustains damage during fulfillment, it could become unsellable. These items might be removed from your inventory without notification, leading to losses.
  2. Misplaced Items: Given the vast number of items stored in Amazon’s fulfillment centers, it’s typical for items to become misplaced, ultimately resulting in loss.
  3. Inventory Reconciliation Problems: Discrepancies between the number of units you dispatched to Amazon and the quantity they actually received can lead to inventory discrepancies and subsequent losses.

What is the FBA Inventory Reimbursement Policy for Shipment to Amazon?

If any of your packages go missing or suffer damage during shipment to an Amazon warehouse, Amazon provides a reimbursement policy for Shipment to Amazon claims.

Before initiating a claim, ensure that your shipping plan aligns with the number of items and contents of the shipment. Additionally, verify whether you’ve previously received reimbursement for the same issue.

Once eligibility for investigation is confirmed, proceed to file a claim within the designated time frame. For Shipment to Amazon claims, this window extends up to nine months from the verified delivery date to an Amazon FC or third-party facility. Failure to file within this timeframe renders you ineligible for reimbursement.

How to Submit a Lost Inventory Claim

To verify if any of your items were lost or damaged during transit to an Amazon FC, follow these steps:

  1. Navigate to the Inventory section, then select Manage FBA Shipments.
  2. Sort or filter the shipments by creation dates and look for closed shipments. Choose the closed one and sort it from newest to oldest.
  3. Compare what you shipped with what was received by Amazon. Pay particular attention to discrepancies, especially significant ones.
  4. On the same shipping plan page, access the Reconcile tab.
  5. Gather all necessary documents such as the Bill of Lading, Invoice, and Proof of Delivery. If you lack a copy of the proof of delivery, the Bill of Lading will suffice.
  6. Once all documents are ready, upload them and send the provided template. Note that the template serves as a reference, but you’re responsible for ensuring accurate information and providing additional details if necessary.
  7. After uploading the necessary documents, preview your request before submission.

To retrieve the SKU, go to Manage FBA Inventory and locate the SKU for the respective ASIN you shipped. It’s crucial to give Amazon the chance to locate the missing items and return them to your inventory. If they cannot locate the units, reimbursement is necessary. In such cases, Amazon typically reimburses you a few days after concluding their investigation.

Amazon may request additional information for your claim, including:

  • Amazon Shipment ID: Obtain this from your Shipping Queue.
  • Proof of Inventory Ownership: Provide a receipt from other sellers, an invoice from your supplier, or a signed packing slip if you’re the manufacturer. Ensure these documents contain the purchase date, quantity, and product names matching the damaged or lost items.

How to Deal with Amazon Lost Inventory

Amazon FBA sellers can take several precautions to address lost inventory. Here are 4 steps to mitigate lost inventory issues:

  1. Monitor Inventory: Keep a close eye on your inventory levels and sales figures to ensure accuracy. Regular monitoring allows you to detect discrepancies early and take corrective measures promptly.
  2. Utilize Inventory Reconciliation Reports: Amazon offers inventory reconciliation reports that aid in identifying inventory inconsistencies. These reports compare the units sent to Amazon with those received. If disparities are detected, leverage these reports to pinpoint missing items and rectify the situation.
  3. File Reimbursement Claims: If you suspect that your inventory has been lost or damaged due to Amazon’s error, initiate a reimbursement claim. This involves submitting a request to Amazon for compensation for lost or damaged items.
  4. Employ Inventory Management Software: Consider using inventory management software to prevent lost inventory and streamline inventory control. These tools assist in monitoring inventory levels, sales, and shipments, facilitating the identification of discrepancies and prompt resolution.

How to Prevent Lost Inventory?

1. Ensure Accurate Labeling of Your Inventory:

Improper labeling ranks among the primary causes of lost inventory. Prioritize thorough labeling of all your products before dispatching them to Amazon’s fulfillment centers. This practice aids in precise tracking and accountability of your inventory.

2. Conduct Routine Inventory Audits:

Alongside regular inventory monitoring, schedule periodic inventory audits. These audits involve physically counting your inventory to verify its alignment with your records. Identifying any disparities allows you to take timely corrective measures.

3.  Utilize Inventory Management Software:

Reiterating the importance of inventory management software, integrate these solutions into your operations to proactively prevent lost inventory. Such software aids in monitoring inventory levels, sales, and shipments, facilitating the detection of discrepancies and prompt resolution.

The Ripple Effect of Lost Inventory

The consequences of missing inventory are far-reaching, impacting not just individual sellers but also the entire ecosystem. Sellers grapple with financial losses, operational headaches, and damaged customer relationships. For Amazon, the challenge lies in maintaining trust and ensuring the smooth functioning of its complex logistics network.

Financial Erosion: Every missing product represents a foregone sale, directly eroding seller profits. Inventory discrepancies disrupt planned sales strategies, forcing adjustments and potentially lowering profit margins. Cash flow suffers as lost inventory necessitates replacement purchases, straining budgets and hindering reinvestment.

Operational Vortex: The search for missing items triggers a time-consuming investigative spiral. Sellers must file complex claims, often with insufficient proof or facing lengthy bureaucratic processes. Replacing lost inventory requires scrambling to source new products, impacting fulfillment timelines and customer satisfaction.

Customer Erosion: Missing inventory translates to unfulfilled orders. Customers experience delayed deliveries or outright cancellations, leading to frustration and potential brand damage. Negative reviews spread, eroding customer trust and hindering future sales.

These cascading effects paint a stark picture of how lost inventory can ripple through the eCommerce ecosystem, jeopardizing not just individual sellers but the entire marketplace’s efficiency and reputation.

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