Starting June 1st, 2024, the updated returns processing fee will apply to products with a high return rate, except for apparel and shoes, and will be charged on a rolling three-month basis.
As previously announced in the 2024 US fee changes, these changes are expected to occur after the close of every three months. For example, for items shipped in June, returns are tracked from June through August, and the fee is charged in September. The fee is only charged if the total number of returns for the product shipped in that month exceeds the threshold set for the specific product’s fee category.
Example of a returns processing fee:
1,000 units of a product were shipped to customers in June. In June, July, and August, 120 of the 1,000 units shipped were returned. The returns threshold for this example product category is 10%*. As a result, returns that exceed 100 units (10% of the 1,000 shipped) during the shipment month and subsequent two months will incur a returns processing fee. In this case, 120 units were returned, so 20 units would be charged the returns processing fee. The fee will be charged between September 7 to 15.
Where can I find my returns threshold?
The threshold varies by category, ranging from 2.9% for grocery and gourmet goods to 12.8% for backpacks, handbags, and luggage. Find your category’s return threshold on Seller Central.
6 Strategies to Reduce Returns and Avoid Fees
- Stay on top of your data
To help sellers understand both returns and return rates, Amazon has made several improvements to the Return Insights dashboard on the FBA Returns page. This updated dashboard will now include the following insights:
- Number of returned units and return rate percentages used to calculate the fee
- Minimum return rate thresholds above which fees are charged
- Number of returned units above the threshold for which fees are charged
With these updated improvements, sellers can monitor their returns data and adjust before the three-month period expires. They should monitor for higher-than-threshold return rates and make adjustments as necessary.
- Create compelling and accurate product pages
Ensure that your product pages provide a detailed, accurate description. Include clear, high-resolution images from multiple angles and other relevant images for your products, including lifestyle images, dimensional images, product comparison charts, editorialized imagery, and more. Videos also help showcase product features and use cases that consumers watch to ensure they’re making a sound purchase decision. Consumers make informed buying decisions using these product assets and will return items that don’t come as described.
- Analyze your reviews for product defects or improvements.
Quality control is often vocalized by your customers. Consumers who return items will explain their issues with the product within a review. Using VOC can help combat product defects or make product improvements that can help reduce your return rate in the future.
- Optimize product packaging for transit
Is breakage during transit a common issue for your product? Adjusting your product packaging for safer transit can save you a fortune in product loss and damage and reduce your return rate.
- Offer incentives for loyalty
Consider offering an incentive to keep the product rather than return it. Future discounts and loyalty rewards for customers who keep their products can offer an extra incentive to avoid unnecessary returns.
- Responsive and helpful customer service
Effective customer service can avoid many returns. Promptly addressing product concerns can resolve many issues before the customer returns the item.
By reducing your return rate, Amazon sellers can more easily achieve profitability and avoid unnecessary and unfortunate fees. These updates are a great reminder for sellers to focus on minimizing product returns, best practices for quality control, and effective customer service. Through Amazon’s improvements to the Returns Insight dashboard and the above strategies, sellers can keep their customers and find more success on Amazon.
