Chargebacks

Chargeback Overview

Chargebacks are fees imposed on Amazon vendors for non-compliance with Amazon’s operational requirements and packaging guidelines. These fees are designed to ensure safety, efficiency, and proper inventory management within Amazon’s fulfillment centers. Vendors can dispute chargebacks through established processes and utilize reporting tools to monitor and analyze their compliance performance.

Chargeback Dispute Process

The chargeback dispute process allows Amazon vendors to contest fees imposed for non-compliance. Understanding this process is crucial for managing operational costs effectively.

Key Timeline Requirements:

• Vendors have up to 30 days from notification to dispute a chargeback
• A second dispute can be submitted within 30 days of the first refusal
• If rejected twice, a chargeback cannot be contested further
• Chargebacks outside the 24-month data retention period are not actionable

Dispute Procedure:

• Reviewing Defects: Access the Operational Performance dashboard to analyze defects that led to chargebacks
• Submitting Disputes: Disputes are submitted via the dashboard, requiring identification of the specific chargebacks
• Status Monitoring: Monitor the dispute status as approved, pending, or rejected, with detailed histories available
• Documentation: For specific chargeback types, detailed proof such as item lists and measurement validations must be provided

Disputes should follow the established procedure before contacting support. Vendors can only submit disputes twice for the same chargeback, making it essential to provide comprehensive documentation during the initial submission.

Chargeback Dispute Statuses

Chargeback dispute statuses indicate the current enforcement level of a chargeback, determining whether a vendor will be charged or not. Understanding these statuses helps vendors track the progress of their disputes and manage their financial expectations.

Status Categories:

• Charged: The vendor has been charged, but disputes can be initiated if there are perceived errors
• Under Review: The chargeback status is pending review and decision
• Reversed: The chargeback is being revoked. The vendor will receive payment in the next billing cycle
• Waived: No charges will be applied, as the chargeback has been dismissed

Successful dispute outcomes depend on compliance with submission timelines and proper use of the Operational Performance dashboard processes.

Chargeback Reports Portal

The Chargeback Reports Portal is a comprehensive tool within Vendor Central designed to help vendors generate detailed reports on their chargeback data and analyze operational performance.

Core Features:

• Report Generation: Create new reports by setting parameters like date range, vendor codes, and issue types. Reports are generated in CSV format and include data from up to the last 12 months
• Saved Reports: Reports are stored for up to 3 months. Data in saved reports is static and reflects information available at the time of creation
• Enhanced Filtering: Offers improved filtering options compared to the legacy system, enabling more targeted report generation

Capabilities: Vendors can review their operational performance related to chargebacks over the past 12 months, helping identify trends and areas for improvement. The portal is designed to replace the legacy system, introducing enhanced functionality for managing and analyzing chargeback data.

Specific Chargeback Types

Carton Information Compliance

Carton Information Compliance chargebacks occur when fulfillment centers are unable to recognize or scan required information on shipment boxes.

Common Causes:

• Missing or unscannable barcodes (such as GTIN) on boxes
• Box-level information missing from the Advance Shipment Notification (ASN)
• Mismatched information between physical cartons and digital records

Prevention Strategies:

• Verify that all cartons have the required barcodes
• Ensure barcodes match the information provided digitally
• Complete ASN information accurately before shipment

These chargebacks ensure that all necessary information accompanies shipments to facilitate efficient and accurate inventory management.

Overweight and Oversized Cartons

Overweight and Oversized Carton chargebacks are imposed when vendors fail to adhere to Amazon’s packaging guidelines regarding weight and dimension limits.

Chargeback Criteria:

• Overweight Carton: A box containing multiple sellable units weighing over 23 kg (unless each individual unit is heavier than 23 kg)
• Oversized Carton: Any carton with a side exceeding 63.5 cm (unless the singular sellable unit itself is larger than this dimension)

Fee Structure:

• Overweight Carton: €1.25 per box
• Oversize Carton: €2.73 per box

Applicable Categories: These guidelines primarily apply to hardlines, softlines, consumables (except alcohol), books, and media. Specific exceptions include Amazon Fresh, Advantage, and Vendor Flex programs.

Prevention Guidelines:

• Avoid boxes over 23 kg containing multiple units or ensure proper labeling
• Maintain carton side dimensions under 63.5 cm unless exempt with single larger items
• Review packaging before shipment to ensure compliance

Purpose: These chargebacks are intended to ensure safety and efficiency in Amazon’s fulfillment centers by minimizing manual handling requirements and preventing processing delays.

Best Practices

To minimize chargebacks and maintain compliance:

1. Regular Monitoring: Use the Chargeback Reports Portal to track performance trends
2. Proactive Compliance: Ensure packaging meets Amazon’s guidelines before shipment
3. Accurate Documentation: Maintain precise ASN information and barcode accuracy
4. Timely Disputes: Submit disputes within the 30-day window with comprehensive supporting documentation
5. Performance Analysis: Regularly review the Operational Performance dashboard to identify and address recurring issues

Understanding and managing chargebacks effectively is essential for maintaining profitability and operational efficiency as an Amazon vendor.