Amazon Reimbursement Policy 2025: The Definitive Guide for FBA Sellers
Amazon has updated its FBA reimbursement rules — sellers will now be reimbursed based on manufacturing cost, not retail value. Here’s everything you need to know to protect your business.
Watch: 60-Second Overview of the 2025 Reimbursement Changes
Quick explainer: how Amazon’s switch to manufacturing cost affects FBA reimbursements and what to do now.
Amazon’s New FBA Reimbursement Policy Explained
Effective March 10, 2025, Amazon’s FBA Inventory Reimbursement Policy calculates payouts based on manufacturing cost rather than the retail selling price. This shift means most sellers will receive significantly lower reimbursements when inventory is lost or damaged in Amazon’s warehouses or during fulfillment.
Previously, reimbursements were based on the product’s average selling price, adjusted for fees. Under the new system, reimbursements reflect the cost to produce or source the item, excluding shipping, duties, and marketing. For many sellers, this represents a 50% or greater reduction in payouts.
What Counts as Manufacturing Cost?
Amazon defines manufacturing cost as the amount spent to produce or source the item. It does not include:
- Shipping or freight charges
- Customs duties, tariffs, or taxes
- Amazon FBA storage or fulfillment fees
- Marketing, branding, or advertising expenses
This calculation benefits low-margin products but punishes private-label sellers with higher markups. For example, a $5 landed cost item that sells for $25 will only yield a reimbursement close to $5–$6, not $25.
How to Submit Your Manufacturing Cost to Amazon
Sellers can use Amazon’s new “Manage Your Manufacturing Cost” tool (rolling out January 2025) to ensure accurate reimbursement. This tool allows sellers to:
- Manually input verified cost of goods
- Upload invoices, purchase orders, or supplier contracts
- Compare Amazon’s estimated cost with actual values
If no data is submitted, Amazon will estimate costs based on market trends — often far below actual sourcing costs.
Impact of the 2025 Reimbursement Policy on Sellers
Key Risks
- Lower payouts: Expect reduced reimbursement amounts across most categories.
- Increased workload: Sellers must maintain invoices and cost documentation.
- Disputes likely: Amazon’s default cost estimates often undercut true values.
Possible Advantages
- Transparency: Clearer documentation may streamline claims.
- Stable calculations: Payouts are no longer tied to fluctuating retail prices.
Types of Amazon Reimbursements in 2025
Amazon reimburses sellers in several scenarios:
- Lost inventory reimbursements – when Amazon loses units in its FBA network
- Damaged inventory reimbursements – when goods are damaged in warehouses or by carriers
- Overcharge and fee errors – incorrect FBA fee assessments
- Customer return reimbursements – when buyers fail to return items or return them unsellable
- Inbound shipment issues – shortages or damage during Amazon receiving
How to File a Reimbursement Claim Correctly
- Go to Seller Central > Inventory Adjustments.
- Review missing or damaged units.
- Open a case with FBA Customer Support.
- Attach invoices, PO copies, or cost documentation.
- Track claim progress in the case log.
Tip: Keep detailed cost records ready — Amazon now demands proof of sourcing cost before approving claims.
Disputing an Unfair Amazon Reimbursement
If you believe Amazon undervalued your inventory:
- Submit corrected manufacturing cost data via the reimbursement tool.
- Upload multiple forms of evidence (invoices, supplier agreements, receipts).
- Escalate the claim to Seller Support and request case manager review.
- If unresolved, consult with an Amazon seller attorney for arbitration or escalation.
Best Practices to Maximize Reimbursements
- Maintain cost-of-goods spreadsheets and supplier invoices for every SKU.
- Audit your inventory adjustments monthly for discrepancies.
- Use third-party FBA audit tools to catch missed reimbursements.
- Set calendar reminders for claim deadlines (usually 18 months).
Need Help With Amazon Reimbursements?
If Amazon underpays your claim or rejects your documentation, AMZ Sellers Attorney® can help you fight back. Our attorneys specialize in Amazon reimbursement disputes and arbitration.
Request a Free Consultation
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