How to avoid Amazon Vendor central chargebacks

  December 04, 2018       By Ray Atia

How to avoid Amazon Vendor central chargebacks?
Amazon Chargebacks, it’s extremely painful for all suppliers and dropshippers to see these deductions from their sales after putting so much effort to find the right product, promote and sell it online using the Amazon Vendor Central. Nobody likes it. Everybody wants to maximize their sales and profit on Amazon, however, these Amazon Chargebacks are reducing so much from the sellers profit that its vital to find a solution to these Chargebacks from Amazon. 

There are a few reasons why Amazon apply chargebacks to their vendors, suppliers and dropshippers.

The first types of chargebacks are due to some issues with the Purchase Order Acknowledgement.
The first reason for getting chargebacks from Amazon Vendor Central is that the suppliers and dropshippers are sending late P.O. Acknowledgement which is the EDI-855, which means that the suppliers did not send the P.O. conformation back to Amazon Vendor Central within 24 hours since the order was placed. Amazon expect their suppliers, vendors and dropshippers to accept or back-order the orders being released by Amazon Vendor Central within 24 hours, meaning the suppliers have to send back the EDI-855 to Amazon with some information being carried over from the Purchase Order that was send by Amazon Vendor Central to the supplier. If supplier fail to send back the Purchase Order Acknowledgement to Amazon Vendor Central, then Amazon will charge the supplier 1% of product cost price.

The second reason for getting Amazon chargebacks is a Purchase Order Acknowledgement Change after 48 hours since the order was placed by Amazon. Amazon expect suppliers to send back the Purchase Order Acknowledgement Change no later the 24 hours after the Purchase Order Acknowledgement was sent back to Amazon. This can also lead to a 1% chargeback from Amazon.

The third reason for getting chargebacks from Amazon is not sending the ship date for back orders. Amazon expect suppliers and dropshippers to send a ship date for an order that was back-order so Amazon and customer will know when the order will be shipped by.


The second types of chargebacks are due to some issues with the Shipments Fulfillment.
First reason for getting a chargeback from Amazon will be that there was no label on the carton. Amazon expect all cartons and other types of containers to have a shipping label with barcode printed on it. Each carton or container that will be missing a label will cause a chargeback from Amazon.

The second reason for getting a chargeback from Amazon a chargeback from Amazon is a missing Purchase Order Number printed on the shipping label.

The third reason for getting a chargeback from Amazon is there was no barcode printed on the product. Amazon expect each product to have a barcode printer on it.

The fourth reason for getting a chargeback from Amazon is that a product is expired or close to being expired.


The third types of chargebacks are due to some issues with the Advanced Shipping Notification.
The first reason for getting a chargeback from Amazon is sending the ASN too late. Amazon expect their suppliers and dropshippers to send back the ASN back to Amazon Vendor Central or through EDI once before the shipment is being actually delivered to one of the Amazon Fulfilment Centers. If the ASN is being sent to Amazon later, after the shipment was received at the Amazon Fulfilment Center, then Amazon will charge supplier between $5 for a small parcel and upto $150 for LTL, Less than TruckLoad.

The second reason for getting a chargeback from Amazon is not sending an ASN back to Amazon.

In addition to all these reasons for getting a chargebacks from Amazon, suppliers and dropshippers can also receive Amazon chargebacks that relates to some packaging issues.

Although Amazon gives a high volume of business activities to it supplier, vendor and dropshippers, it wants to ensure that they work properly and provide the best fulfilment, shipping and status updates to the Amazon buyers.

So how to avoid Amazon chargeback?
Well, there is something called EDI. By integrating EDI with your Amazon Vendor Central account, Amazon supplier, vendor and dropshippers can elimited those unfair chargebacks. By implementing EDI with Amazon Vendor Central, the EDI connector will check all data being transferred from the supplier, vendor and dropshippers to Amazon and make sure cross references are properly match, order data is accurately carried over to shipment and invoice. EDI with Amazon Vendor Central will also make sure messages associated with an order will come in the right sequence and be with the right data required by Amazon Vendor Central and if something will be missing or wrong, it will send an alert to the Amazon seller to notify about a problem with the data, so the Amazon vendor will have the opportunity to fix the document before it being send out to Amazon Vendor Central and will prevent chargebacks from Amazon.

Amosoft offers EDI Integration with Amazon Vendor Central. Implementing EDI with us will prevent chargebacks from Amazon and suppliers are guaranteed to be fully compliant with Amazon EDI.