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A survey showed that 92% of customers would be happy to buy from a store again if the return experience was good. However, processing returns can be expensive, especially when you sell online, such as on Amazon’s marketplace, where products are often eligible for free returns.
How To Refund On Amazon
So how do you ensure you’re delivering the products your customers want without taxing your store’s already stretched resources?
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No chargebacks on Amazon are a special type of chargeback that allow sellers to compensate buyers for incorrect or damaged orders without requiring them to return the product. Sellers can choose to receive a full refund or replace the product with a new one in the Seller Central returns dashboard.
However, keep in mind that non-refundable refunds are optional and you don’t necessarily need to sign up. In fact, you can even select products that you want to offer a non-returnable refund.
Processing returns on Amazon can be expensive. As a seller, you must pay for return postage. If you are doing FBM, you need to check whether the returned items can be resold or should be thrown away. All this requires time, money and labor. By offering non-refundable refunds, Amazon enables sellers to conserve resources and run their stores efficiently.
No refunds also allow Amazon to reinforce its vision of becoming a customer-centric company. People can shop worry-free knowing that if something goes wrong, they can get a full refund without having to worry about returns.
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All Amazon marketplaces offer non-returnable refunds. So whether you’re selling in the US, UK, Australia or India, you can sign up for chargeback-free refunds in Seller Central.
The Amazon refund system operates according to a predetermined set of rules. These rules basically specify the criteria for products in the Amazon store that are eligible for non-returnable refunds and are set by the seller.
When a buyer submits a return, Amazon checks whether the case qualifies as non-refundable and issues a refund on the seller’s behalf. This amount is automatically deducted from their account balance. All orders placed before the rule was created will be processed normally.
You can set non-returnable refund rules for an entire product category or for specific items within it. More on this later.
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Amazon will process all non-return refund requests, except for handmade and non-physical items, sexual health products, dental and medical supplies, certified pre-owned watches, hazmat, and Amazon custom items. You must process these requests manually through the buyer-seller messaging system. The same applies to returns requested after 30 days.
In addition to the non-returnable refund option, Amazon also offers two other types of refunds: i) prepaid returns and ii) free refunds.
Prepaid returns mean your customers don’t have to pay for postage up front. They simply get a prepaid shipping label from Amazon, affix it to the product, and ship it back to you. Once you receive the product, you can process a partial refund, which will deduct shipping costs from the customer’s final refund amount.
In contrast, free returns allow customers to get a full refund on returns. You can choose to offer free returns on all, some, or none of your products. However, fashion items, with the exception of luggage and bags, have a mandatory free return option.
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Once a refund request is submitted, Amazon takes 1-2 business days to process non-returnable refunds. This is quite fast compared to normal refunds, which can take up to 5 working days from receipt of the item to complete.
Technically, Amazon doesn’t have a non-returnable refund limit. However, the e-commerce giant regularly monitors customer return requests to ensure the policy is not abused. It is believed that Amazon will ban customers who return more than 10% of their total orders. Of course, this may vary depending on the situation.
While no refunds seem to be most useful to customers, they also offer many benefits to Amazon store owners.
We have briefly discussed this before. Processing returns costs money. You must pay return charges, especially if the product is defective or the order was delivered incorrectly. These situations are common when selling on Amazon.
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Even if you know you’re sending the correct product, customers will always find a reason to complain to Amazon, leaving you no choice but to comply. Of course, there’s not much you can do if the product qualifies for free returns.
While there’s nothing wrong with paying for returns, shipping costs can sometimes be higher than the actual price of the item. You then have to pay an additional fee to get the item back on Amazon store shelves.
Likewise, there are some products that cannot be resold even if your customers return them. A pair of socks is a perfect example. Want to resell a returned pair of socks that one of your customers may have tried on before?
As a seller, you must wait for the customer to return the item before proceeding with the refund. This can take several days, sometimes even a week.
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After receiving the product, you must manually check and see if it can be restocked. If you’re doing FBM, that again means hours in the warehouse. In the end, if something goes wrong with the product, all your hard work is wasted, and then you have to find a way to deal with it.
This might not sound like a big deal if you’re new to Amazon and your sales are low, but once you start getting more daily orders, things can quickly get out of hand.
Let’s face it, customers don’t like dealing with returns either. Starting the return process, printing a shipping label, and then driving to a nearby drop-off location can be a hassle.
You should also realize that your customers are already unhappy with their purchases. Asking them to complete these steps may make them more uneasy. They may leave negative comments on your listing or give your product a bad review. Your goal should be to reduce friction as much as possible.
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When customers see that you care about them and offer hassle-free returns, they will be more likely to return to your store and buy from you again in the future. They might even become your regular customers.
As a business owner, you have a responsibility to play your part in making this planet a greener and healthier place. You should adopt sustainable business practices and try to avoid those that may harm the planet in the long run.
Processing returns creates unnecessary waste in carbon and landfill. This is bad for our ecosystem. Of course, you can’t always skip them. However, you can make a positive contribution to the environment by offering non-refundable refunds on certain products.
At the same time, it can also play a good marketing role. Consumers prefer to purchase products from eco-friendly brands. You can take advantage of this to position your Amazon store.
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The biggest concern with offering non-returnable refunds on Amazon is people trying to scam you by abusing the policy.
Even though there may not be anything wrong with your product, some customers will make up false cases and try to get a refund from you. It will definitely cost you profits.
Unfortunately, there is no way to avoid such scammers. Amazon checks customer return rates, which helps to an extent, but you have to be prepared to take more or less of a hit.
Another downside to offering non-returnable refunds on Amazon is that if you’re not careful with the rules you set, you could end up wasting valuable inventory. This is a common question for sellers selling globally.
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Product dynamics often vary by market. Setting the same standards across all stores may not be the best way to handle non-refunds.
If you’d like to learn more about your returns policy and set up no-return return rules for a specific SKU, you can do so by submitting a no-return solution template file. You can download it from the returns settings page.
Unfortunately, individual sellers are unable to obtain non-refundable refunds. You must have a professional plan to use this option.
Customers can get their money back via Amazon gift cards, depending on how they want their money back. Typically, Amazon customers prefer refunds via PayPal or credit card.
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Any product that meets the criteria set forth in the no-return refund rules is eligible for a no-return refund on Amazon. Additionally, in order for refunds to be automatically issued, customers must submit all requests for Amazon refunds on non-returnable items within 30 days of the date of purchase.
You can check the non-return refund status for a SKU by downloading the status report from the Manage Returns Templates page.
All in all, cash back refunds on Amazon are a great way to increase customer loyalty and save money and resources
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