Amazon's FBA Reimbursements Pilot: Two Months In

Amazon launched a pilot program for select FBA sellers on July 26, 2024, promising to proactively reimburse them for eligible lost inventory within their fulfillment centers. This initiative aims to streamline the reimbursement process, saving sellers valuable time and effort typically spent on filing claims. While Amazon indicated that reimbursements would be issued promptly, they also noted potential delays of up to three weeks in some cases.

Two months into the pilot, we've conducted an in-depth analysis to evaluate the effectiveness and completeness of this auto-reimbursement scheme.

Our Methodology

• Data Collection: We gathered lost inventory and reimbursement data for 152 of our clients enrolled in the pilot program. Upon notification of their inclusion, we suspended all manual case-filing activities for these accounts.
• Observation Period: We focused on lost inventory events that occurred between July 26th and August 5th, allowing sufficient time (three weeks) for the auto-reimbursement process to complete by August 26th.
• Data Analysis: We identified instances where items were eligible for reimbursement but not automatically processed (Category A) and compared this against the number of successful auto-reimbursements (Category B). The combined total of A and B represents the universe of eligible lost inventory events.

Key Findings: 33% of eligible reimbursements were not auto-reimbursed by Amazon

• Eligible Reimbursements: We identified a total of 10,842 units as eligible for reimbursement, with a combined value of $260,442.86
• Auto-Reimbursement Gaps: 1,289 units (12% of eligible units) valued at $85,165.67 (33% of eligible value) were not auto-reimbursed despite being eligible
• Success Rate: 9,553 units (88% of eligible units), representing $175,277.19 (67% of eligible value), were successfully auto-reimbursed.

Gaps in the system

Amazon's proactive reimbursement pilot shows promise in reducing the administrative burden on sellers. However, our analysis underscores the critical need for sellers to maintain their own reimbursement strategies, either independently or through third-party services like DimeTyd. Relying solely on Amazon's auto-reimbursement, even within this pilot program, leaves a significant portion of lost inventory value unaccounted for.

While we commend Amazon's efforts to streamline the reimbursement process, the current pilot's performance highlights the persistent gaps in their system. The financial impact of unreimbursed losses can be substantial, particularly for small businesses operating on thin margins.

What should sellers do?

We urge sellers not to become complacent and to continue proactively monitoring their inventory and pursuing reimbursements for any losses not addressed by Amazon's automated system. Services like DimeTyd offer increased accuracy, efficiency, and peace of mind in navigating the complexities of Amazon reimbursements.

In the spirit of further analysis, we will continue to abstain from filing cases for our clients enrolled in the pilot, even beyond the initial three-week window. This will allow us to observe whether Amazon eventually auto-reimburses these losses, providing additional data on the program's long-term effectiveness.

Conclusion

We remain optimistic that Amazon will continue to refine their auto-reimbursement algorithms and improve transparency around this process. However, until then, sellers must remain vigilant and take proactive steps to protect their businesses and ensure they receive fair compensation for lost inventory.

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