Amazon recently announced return-related fees for sellers in 2024. For many, this has raised concerns about profit margins and how to manage operational costs more efficiently. This blog will walk you through what’s changing and what steps you can take to reduce your return rate and return-related fees.
What Is Amazon’s FBA Return Policy?
With FBA, Amazon takes care of shipping, customer service, and returns for sellers. The platform follows its own return policy. You don’t have control over whether a return is accepted, even if the customer is clearly at fault or the item was damaged after delivery.
Most buyers have 30 days to return a product, but there are exceptions, and Amazon may accept returns after that period.
Once a return is initiated, Amazon notifies you by email and deducts the order amount from your account balance.
The Return Process to Amazon’s Warehouse
When a customer returns an item to Amazon’s warehouse, Amazon checks the condition of the product to decide what to do with it.
If the item is unused and still in new condition, it goes back into your sellable inventory. This means it can be sent out again in a future order.
If the item is damaged or not in a condition to be resold, Amazon looks at who caused the damage. If Amazon is responsible (for example, damage during storage or shipping), they will reimburse you for the product.
If the customer damaged the item or if it was damaged during return shipping, Amazon won’t reimburse you. Instead, the item will be marked as “unsellable.”
For items marked as “Customer Damaged” or “Defective,” you need to submit a removal order within 30 days. You can ask Amazon to return the item to you or dispose of it. You can also set up automatic removal settings in Seller Central to handle this for you.
What to Expect When a Customer Doesn’t Send Back a Return
If the customer doesn’t return the product within 45 days, Amazon will recharge the customer if they have already received a refund. In most cases, Amazon will then reimburse you for the item automatically. If that doesn’t happen, you may need to contact Seller Support to request the reimbursement.
For certain categories like Baby products, Amazon offers an extended return window of up to 90 days. The item must be new and unopened to qualify. If it’s been used or opened, it won’t be accepted under this extended policy. Amazon covers the return shipping cost.
The 2024 Return Processing Fee
In 2024, Amazon introduced a new returns processing fee for high-return products in all categories, excluding apparel and footwear. This fee helps cover the cost of handling returns and aims to cut down on waste.
The fee only applies if a product’s return rate goes over a set limit based on its category. The amount charged per unit depends on the product’s size and shipping weight.
Your product is exempt from this fee if you ship fewer than 25 units in a month. You can check your product’s return rate on the FBA Returns page, which is updated three times a week.
Amazon’s Restocking Fee
In some cases, Amazon lets sellers charge a restocking fee when a customer returns an item. This fee is a percentage of the item’s price (not including shipping) and depends on the condition of the item when it’s returned.
You can charge a restocking fee if the return is outside the 30-day window, or if the item comes back used, damaged, defective, or not as originally sent. However, if the product is returned in its original condition and within Amazon’s return period, you cannot charge a restocking fee.
You can find a breakdown of which return requests qualify for restocking fees on Seller Central.
7 Ways to Lower Your Return Costs
Once you’ve reviewed your return data, take action to bring those numbers down. Here’s how:
Write Clear and Accurate Product Descriptions
Make sure your product listings are 100% accurate. Include the right product dimensions, colors, materials, and anything else that helps set the right expectations. If buyers receive even slightly something different from what they saw online, they’re more likely to return it.
Avoid using generic descriptions or copy-pasting from the manufacturer. Describe the product in your own words, clearly and simply, so buyers know exactly what they’re getting.
Use High-Quality Images (and Add Videos if Possible)
Photos are just as important as text. Use high-resolution images that show the product from multiple angles. Include close-ups of details and show scale if size is important. If you’re selling clothing, show the item on a model and include a sizing chart. Adding a short product video can also help show how the item looks and works in real life.
Improve Packaging to Prevent Damage
Many returns happen because items arrive damaged. Use strong, secure packaging that fits the item properly. Avoid oversized boxes that leave too much room for items to shift during shipping. If the item is fragile, add bubble wrap, foam inserts, or other protective materials. Damaged goods not only cost you in returns but can also lead to bad reviews. If you use FBA, make sure your packaging meets Amazon’s prep and packaging requirements so it’s handled correctly in the warehouse.
Track Return Reasons Regularly
Amazon gives you data on why items are being returned. Go to your Returns Report in Seller Central and look for patterns. If multiple customers return the same product with similar complaints like “too small” or “not working”, use this information to improve your listings, fix product issues, or even remove problem SKUs if they’re costing you too much.
Offer Better Fit and Sizing Info for Apparel
If you sell clothing or shoes, most returns are likely due to sizing issues. Include a clear and accurate size chart. If the item runs large or small, mention that directly in the listing. Use phrases like “runs half a size small” or “relaxed fit.” Avoid vague sizing terms like “true to size” unless you back it up with measurements or examples.
Include Product Guides or Setup Instructions
Some customers return products simply because they don’t know how to use them. Add a simple setup guide or an FAQ sheet. For complex products like electronics or tools, link to a how-to video or include a QR code.
Set Up Automated Removal of Unsellable Inventory
Returned items that are marked as “unsellable” can sit in Amazon’s warehouse and rack up storage fees if you don’t act. Go to your Seller Central account and set up automatic removal of these items. You can choose to have them returned to you or disposed of. If the product is in decent condition, you might be able to clean it up and resell it elsewhere (like on eBay or your own website).
Final Thoughts
Returns are part of doing business online, but they don’t have to hurt your bottom line. Stay proactive, track your data, and keep testing what works best for your products.
Need help adjusting your listings, handling return data, or improving your Amazon strategy? Enso Brands is a full-service Amazon agency that helps sellers like you stay ahead. From listing optimization to performance reports, we’ve got your back. Contact us today.
