What Happens When You Owe Amazon Money?

What Happens When You Owe Amazon Money?

Don’t be Negative If You Owe Amazon Money

How do you know when you owe Amazon money? If you see a negative balance on your Amazon Seller account, that means you owe Amazon money.

First off, relax. While a negative balance does indicate you owe Amazon money, it doesn’t mean you are doing anything wrong or that you are somehow in trouble with Amazon. In most cases, for you to owe Amazon money is a temporary issue. Actually, what’s more likely is that Amazon owes you money that you are unaware of.

To clarify what a negative balance means and if you actually owe Amazon money, let’s delve into the details:

  • Amazon Seller’s negative balance 
  • How to  know if Amazon owes you money
  • How to get money Amazon owes you
Amazon Seller Negative Balance

Amazon Seller Negative Balance

There is a famous quote by Micawber, a character in David Copperfield by Charles Dickens, which goes, “Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds naught and six, result misery.”

But just because you have an Amazon Seller negative balance, you needn’t feel miserable. It just means your fees and costs for selling on Amazon exceed your revenues for a given period. You got paid during the previous month, and then issued refunds which, along with certain fees, total more than what you are owed for sales. And while this does indicate you owe Amazon money, in most cases, you probably won’t have to pay anything at the end of the total settlement period because additional sales have made up for the negative balance. 

Your Payments Report summarizes the credits and charges to your account. You’ll see two kinds of charges:

  • Fees. The type of fees varies depending on whether you are Fulfillment by Amazon (FBA) or FBM (Fulfillment by Merchant), as well as the type of products you sell and services used. To see order-level details of fees, go to the Transaction View of your Payments report and click on the order total amount. Your Amazon Services Business Solutions Agreement and Selling on Amazon Fee Schedule list all the fees associated with your account.
  • Product Refunds. The Amazon Services Business Solution Agreement also details Amazon’s administrative fees for handling refunds. If you’ve already received payment for a product and then issued a refund, Amazon charges you an additional administrative fee. 
How Do You Know If Amazon Owes You Money?

How Do You Know If Amazon Owes You Money?

Your Amazon Settlement Report details all your transaction activity during a given settlement period. There is a separate line for every product in an order, as well as every product in an order that is refunded, in whole or in part. To view your report to see why you owe Amazon money:

  1. Go to the All Statements page of the Payments Report in Seller Central.
  2. Filter for a specific time period using the Select Date Range.
  3. Click one of the Download buttons in the Actions column for the settlement period you’re interested in. Your choices are:
    • Download XML: An XML file that you can open in a program such as Microsoft Excel
    • Download Flat File: A tab-delimited text file
    • Download Flat File V2: FBAsellers can use this file with the Settlement Summary Template to build a pivot table that provides a simplified display of details by order. 
  4. Save the file to your computer, and open the file using your preferred spreadsheet or database program.

Further examination of the report can give you a better understanding of why you have a negative balance and why you owe Amazon money for that period. 

How to Get Money Amazon Owes You

While there may be times when you owe Amazon money, if you are an FBA seller it’s more likely the case Amazon owes money to you. You just don’t know about it.

This is another situation where you really have to scrutinize your Seller account to see if Amazon made any mistakes in handling your inventory, if any of your inventory was lost or damaged, or if refunds weren’t properly credited. Given the immense number of transactions Amazon processes worldwide, it’s not surprising that mistakes sometimes happen. Perhaps surprising is that Amazon doesn’t always automatically credit your account when it makes these mistakes. For the most part, it’s up to you to track and claim what Amazon might owe you.

This can be particularly tedious and time-consuming if you have a large number of SKUs. But it’s not something you want to ignore. Amazon FBA reimbursements can average roughly anywhere from 1% to 3% of your annual revenues. If you made $500,000, Amazon could owe you anywhere from $5,000 to $15,000. That’s more than enough to make up for a negative balance.

Fortunately, there’s a better way to get the reimbursement you are owed without any time or resource expenditure on your part and with no risk.  GETIDA (GET Intelligent Data Analytics) combines a powerful software tool that quickly reviews your Seller account with an experienced team of former Amazon employees to file and follow up on your reimbursement claims. There’s no charge to use the software or even to file claims. You are only charged a percentage of claims approved for reimbursement, and the first $400 of refunds are free of charge.

To sign up, go to GETIDA  website and complete a few quick steps. GETIDA scans the past 18 months of your Seller account; you get a report and decide whether to submit any reimbursement claims. GETIDA takes it from there. 

It’s also free to sign up for GETIDA. Even better, you can get $400 in free FBA Reimbursements to try them out. Because at GETIDA we believe it is better for Amazon to pay you the money it owes you rather than for you to owe Amazon money.