How do I find out how an Amazon seller handles its returns and damaged units?
Ask for return reports by product, with reasons, outcomes and costs, and see how damaged units are treated: resold, claimed from the carrier or platform, or written off. Compare the figures with reviews and the books. A seller who tracks reasons and acts on them is easier to trust than one who only knows totals.
Returns are a hidden cost in online selling. Ask for reports showing returns by product and reason, how many went back on sale, how many were damaged, and what each type of loss cost. Then look at whether the pattern points to a product problem, a packaging problem or a listing that overpromises.
Find out who covers damage. Some is reimbursed by the carrier or the platform, and some falls on the seller. Ask for evidence of claims made and money received, and check whether the seller files them promptly or lets them lapse. Read customer reviews. Complaints about broken items, wrong sizes or slow refunds tell you what the data may not. Compare them with the seller’s story. Ask about return rates by product over time, not just in total, and about any listing that was pulled because of complaints. A product with a rising rate may be failing, and a seller who has already dropped it is showing good judgement you should notice and write down.
Ask what happens to returned stock: inspection, relabelling, liquidation or disposal. Look at how the accounts record these losses and whether margins are shown before or after them. Your accountant can tell you whether the reported profit is realistic.
Key takeaways
- Request return reports by product, reason, outcome and cost.
- Check how damage claims are filed and how much was actually recovered.
- Read reviews for complaints the data does not show.
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Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
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