A Better Return System for Amazon Sellers
Selling on Amazon can be profitable and rewarding. While it would be nice if every one of your customers loved every product you sell, that isn’t the reality. As an Amazon seller, you will quickly need to figure out how you are going to handle returns because it won’t be long before you get one. On average, 18% of all products purchased online are returned. However, it’s important to note that this rate can vary quite a bit between product categories. Clothing has a 56% return rate, while books and games typically have a 5% return rate.
So what can you, as a seller, do to put yourself in the best position when returns inevitably begin to trickle in? You put a system in place that can help you seamlessly serve your customers while protecting your profits.
Note: This article reflects the most up-to-date return information from Amazon as of January 2023. We try and keep our articles updated, but you should always check the Amazon website to confirm its most current policies
Amazon Seller Central Help Section for Returns, Refunds, Etc.
Fulfilled By Amazon — safe but limited
When you agree to let your sales be fulfilled by Amazon, they take on the responsibility of warehousing, shipping, and customer service. Naturally, there are some fees associated with this, but it also represents the least amount of risk for sellers. In this case, Amazon takes returns within 30 days, stores them in their warehouse, and determines if the items have any resale value. Depending on their findings, sellers may receive refunds on the sell price and the FBA fees.
This is good, but sellers must adhere to Amazon’s strict return policies. Also, not every product will qualify for FBA, which means sellers must find other ways of addressing returns. So, what happens when you take on the responsibility of handling returns yourself?
Fulfilled by Merchant — More complex, but more flexible
When returns are fulfilled by you, the seller, the options for how to handle them open up considerably. Amazon still has some policies that it requires sellers to follow, but opting for FBM allows for more creative and more nuanced handling of returned products. When an FBM item is returned, it is sent to the return address provided by the seller. For smaller enterprises, this is often a home address. However, it doesn’t have to be. Independent sellers can also opt to send their returns to a self-owned warehouse or partner organization — more on that later.
It is worth noting that Amazon also allows sellers to offer returnless refunds. Sometimes, it costs more to have the items shipped back to you than it does to simply let the customer keep the product. Ultimately, this comes down to price. It’s usually better to go returnless with cheaper items while taking returns on higher-value items you could potentially resell.
The hurdles of taking your own returns
Of course, taking your own returns doesn’t come without challenges. The biggest of which is space. Most independent sellers don’t have a huge warehouse where they can keep inventory. Merchandise is often kept in spare rooms or garages, with minimal extra space. One slow sales month or a month busy with returns and you might find yourself quickly running out of room. It’s also worth noting that having piles of boxes in your home can quickly put undue strain on anyone you live with.
The second issue is time. To stay in Amazon’s good graces, returns need to be dealt with within 24 hours of the request. In a vacuum, that seems reasonable. However, sellers are busy people. Often they are balancing selling on Amazon with another job, family, and outside hobbies and interests. Handling your own returns adds one more thing to the to-do list.
Flexibility with returns
No matter who you choose for your fulfillment — whether you use Amazon or do it yourself — you can still partner with a reverse logistics organization like WIN Warehouse. This lets you leverage either the flexibility of doing it yourself or the ease of using a large partner for shipping while protecting your bottom line with a partner specifically for returns.
Working with a logistics organization to handle your returns is, in many ways, the best of both worlds. You retain the flexibility of not handing all of your processing off to Amazon while also working with a company that has the expertise and resources to handle any volume of returns you may have. This frees up your time, your space, and your to-do list.
Of the logistics organizations that you could partner with, WIN Warehouse is unique. First of all, working with us is FREE. We don’t charge retailers at all to have returns shipped to us. No handling fees. No processing fees. We can do this because we’re a nonprofit ourselves. Our goal isn’t to profit off businesses unloading returns and extra inventory — it’s to equip other nonprofits with the things they need to fulfill their mission.
This brings us to the other unique thing about partnering with WIN. When you work with us you are helping nonprofits make an impact in their communities. We make your donated goods available to nonprofits at a dramatically reduced cost to them — often as much as 90%. When you ship your returns to WIN, you’re helping at-risk youths, veterans, homeless families, and so much more.
When you partner with WIN, you can opt to have your returns routed directly to our warehouse. This immediately takes the stress of handling the returns off of your plate and ensures your space is not cluttered with customer returns.
More importantly, you will be able to write off any returns sent to WIN as a charitable donation on your taxes. This is especially beneficial in situations where it doesn’t make financial sense to try and resell the item. You end up paying less in taxes and you are helping nonprofits carry out the important work they’re doing.
How It Works
Direct your returns to WIN
Whether you are FBA or FBM, when your customer asks to return an item, have them (or Amazon) send it directly to us. We’ll process it as a donation from your company and send you paperwork for your records.
Your goods do great things
We make your donation available to our nonprofit members for a small handling fee that is just a fraction of the full retail price. This allows them to save money and spend more on furthering their mission and making an impact.
Enhance your brand
Liquidating products dilutes your brand. By donating your products, you stay out of secondary markets and eliminate competition against yourself. Plus, consumers are increasingly choosing sustainable and socially responsible brands.
Grow your business
With the cost and hassle of handling returns off of your plate, you’ll be free to spend more time and energy building your business and doing the things you actually want to do. And as a fully scalable solution, we’ll continue to grow with you.
Want to get started?
Ready to put a better returns system in place for your business? Fill out our contact form and Travis will reach out to answer your questions and get you started. It’s that easy.