Fulfillment by Amazon Lost Shipment
A few weeks ago I wrote about how I leveraged Best Buy’s Black Friday in July to price match to Staples and earn huge miles on a product I could resell to breakeven or even make a slight profit. During that sale I was able to pickup 2 iPads from Staples and 1 from Best Buy. After receiving them I sent all three off to Amazon to be sold through FBA (Fullfillment by Amazon).
One thing that should be said about shipping to Amazon is that it takes time. In my case, it took about a week for this shipment to reach Amazon and show as delivered. Unfortunately once they received the package, the iPads never went into inventory on my seller console, so a few days later I emailed Amazon to inquire. They eventually responded with what I didn’t want to hear. They had lost the iPads and the package had simply vanished.
Since the tracking shows the package being delivered to them, Amazon will reimburse me for the iPads. Unfortunately, that reimbursement amount is based on their policy and not what I actually could have made from selling the iPads. As part of their response to me, I was told Amazon would be giving me $492.50 per iPad lost. Here is how they calculate that amount per their policy:
We consider several factors when determining an item’s value, including your sales history and the average FBA selling price on Amazon.
I Could Get More
Right now the cheapest price for Prime eligible iPad of the same model is going for $545.88. When calculating how much to pay me, they subtract out any fees I would have paid. On that sales price my net after fees would be about $513. So basically I am losing about $25 per iPad with the $492.50 reimbursement amount.
I did email Amazon to follow up, but they quickly reminded me that I agreed to this policy as a seller. There does seem to be an escalation process to get a higher rate, however it does say they may request invoices and more information if I go that route. I’m not sure if it will be worth the hassle.
A Slight Loss but Really a Gain
My cost on the iPads was $506.55, however I received rewards and miles that much more than offset the $14 loss per unit. Still, it would have been nice if they didn’t lose them so I could realize a small profit plus the miles. Either way, nothing to sweat about. I’m getting most of my money and I guess the bright side is I don’t have to worry about one of them being defective or getting returned.
I had never heard of Amazon losing someone’s shipment, however with as much as they have going on in the warehouse, it doesn’t surprise me. As a seller I now know that I will probably lose slightly with their valuation for reimbursement, however that won’t necessarily stop me from selling through them again since they really are the best game in town and the reimbursement process was really painless. Resellers out there, has this ever happened to you?