How to Dispute an Amazon Chargeback

2024-02-21
15 min read

At Amazon, compliance fines are referred to as chargebacks. There are many types of chargebacks or issue types of these compliance errors, but in this article, we will focus closely on five common issue types and their sub-types.

As with most compliance-related deductions in the retail space, the majority of chargebacks are valid. Though a number of these will be invalid, the burden of proof rests on the supplier to provide the necessary evidence to dispute and recover lost revenue. So, in this article, we'll also be explaining some of the best methods for Amazon suppliers to win back invalid compliance chargebacks.

How to Research an Amazon Chargeback

Suppliers should start the dispute process for any chargeback with research so that the charge's validity can be determined from the beginning. Research will vary drastically from chargeback to chargeback, each requiring a pretty unique set of processes.

Here, we will only be looking at how to research and dispute five common chargebacks:

  • PO On Time Accuracy

  • ASN Accuracy

  • Carton Content Accuracy

  • No Carton Content Label (no CCL)¬†

  • Non Compliant Barcode

Except for the Non Compliant Barcode issue type, all of these can be researched by starting in the Operational Performance Dashboard on Vendor Central. This can be found in Vendor Central by clicking on Reports and then Operational Performance:

Vendor Central > Reports > Operational Performance

Pulling the report for operational performance will download an Excel document of each of the chargebacks received over a given period. Within this sheet are a series of columns for sorting the data. 

How to Research the PO On Time Accuracy Issue Type 

The PO On Time Accuracy issue type contains three sub-types: 

  • Not On Time

  • Not Filled

  • Down Confirmed

The operational performance report needs to be sorted according to each sub-type being researched.

For the NotOnTime sub-type, sort by [sub-type] = [NotOnTime]

  • Sort [days late] high to low

  • Compare [ship/delivery window end] with the [actual date (yyyy-mm-dd)]

  • For They-Pay/Prepaid vendors, look at [Carrier] and [Purchase order #] to determine which first requested delivery date was out of compliance.

  • For We-Pay/Collect vendors look at [Purchase order #] to determine which freight ready date submission was out of compliance.

For the NotFilled sub-type, sort for [sub-type] = [NotFilled]. This search result will show all of the instances of shipments that were 'Not Filled.'

From there, this information can be compared against a supplier's records to do validity checks on the compliance fines themselves.

How to Research the ASN Accuracy Issue Type

The ASN Accuracy issue type is similarly dealt with in the operational performance report. The sub-types for ASN Accuracy are:

  • On-Time Non-Compliance (ONTC)

  • Unit Count Mismatch

  • Invalid/Missing ARN

  • Missing/Invalid Expiration Date

  • PRO/BOL Mismatch

Depending on the form of shipment (i.e. They-Pay/Prepaid or We-Pay/Collect), only some of these sub-types may be possible. For example, a PRO/BOL Mismatch cannot be received by a supplier who only ships We-Pay/Collect.

Although it is rare, sometimes ASN Accuracy issues are connected to an EDI issue and can be best dealt with by having clear communication with your EDI provider.

In general, having a clear sense of when the ASN was sent by the supplier and received by the retailer will help to pinpoint the particular sub-type within this issue type. Amazon provides 5 Common Failure Modes as further help for understanding them:

  1. ASN arrives too late:

    a. ASN submission batching (3P facility). This is especially an issue when FC is very close to DC

    b. Incomplete ASN submission via VC (pending Excel upload, failed confirmation after submitting routing requests)

    c. ASN edits replacing the original content of the ASN (make sure you are using the right EDI syntax to append to the ASN contents)

    d. EDI transmission/syntax failures (please note MDN failures and success messages)

  2. The ASN is missing expiration dates:

    a. BPS vendors are not required to provide expiration dates on the ASN, however, a missing expiration date chargeback gets triggered if the ASN does not have the date (dispute)

    b. ASIN inaccurately marked as an expiration dated item in Amazon's catalog (dispute, contact Amazon)

    c. GTIN-14 vendors using Vendor Central for ASN transmissions (only AMZNCC vendors should use Vendor Central for ASN submissions that include expiration dated products)

    d. EDI expiration date format issues

  3. Data quality issues with PRO/BOL (They-Pay/Prepaid) number or ARN number (We-Pay/Collect):

    a. Carrier provided incorrect PRO/BOL on appointment request

    b. ARN not included at all

    c. EDI format issues or data quality issues (i.e. the ARN number is stripped of some characters)

  4. Unit count mismatch:

    a. Duplicate ASNs sent for the same shipment (you can use only one transmission method; EDI856 or Vendor Central, not both)

    b. Unit of measure on the ASN is different from what was confirmed on the PO

  5. A problem receiving at the FCs can trigger invalid chargebacks:

    a. Amazon does have some criteria implemented to identify such misreceives/problems in receiving and is proactively waiving them. But, there could be a minor portion that gets missed (dispute)

Disputes may be relevant in many of the above cases. #5, in particular, is a common instance in which suppliers will lose revenue to invalid chargebacks at Amazon. 

How to Research the Carton Content Accuracy Issue Type

Similarly to the two above, the Carton Content Accuracy issue type can be researched in the operational performance report. The Carton Content Accuracy issue type contains four sub-types:

  • Shortage

  • Unexpected Item Overage (UIO)

  • Unexpected Quantity Overage (UQO)

  • Case Pack Defect

Each of these sub-types contains its own way to be researched in the operational performance report:

  1. For a more in-depth look at disputing and researching shortages, see this article. Shortages function differently from other compliance fines. However, because compliance shortages often result in fines, it may still be a good idea to research it in the Operational Performance Dashboard, just like the others. 

  2. For the "Unexpected Item Overage (UIO)" sub-type, sort for [sub-type] = [Unexpected Item Overage]

    a. Use [ASIN] to determine ASIN

    b. And [Purchase order #] to determine the specific PO

    c. Check your packing process to see how the ASIN is physically packed for shipping. Check if there are any item barcodes visible on the case pack/master pack.

  3. For the "vendor did not send mentioned ASIN in carton" sub-type, sort for [sub-type] = [Vendor did not send mentioned ASIN in carton]

    a. Same as above, look at ASIN and PO

    b. Check whether the item barcode for the ASIN is properly mapped to the ASIN in Amazon's catalog.

  4. For the "vendor did not mention ASIN carton" sub-type, sort for [sub-type] = [Vendor did not mention ASIN carton]

    a. Same as above, look at ASIN and PO

    b. Use the carton label and the ASN information you sent to check which ASIN was expected in the carton. Check to see whether the barcode for the expected ASIN is incorrectly mapped to the unexpected ASIN in the Amazon catalog.

How to Research the No Carton Content Label (no CCL) Issue Type

As is the case with the three above, the No Carton Content Label (no CCL) issue type has sub-types and can be researched through the operational performance report. Its sub-types are: 

  • No valid license plate (LP) label present on the carton

  • LP label not on advance shipment notification

  • GTIN-14 Gold List missing

Each of these sub-types contains its own way to be researched in the operational performance report:

  1. Sort for [notes] = [No valid license plate (LP) label present on carton] to find that sub-type. 

    a. Look at the carton images provided and determine if the label was missing or, if not, why Amazon receiving was not able to scan the label (ink quality, label placed on a seam, label placed too close to the edge of the carton, label damaged in transit).

  2. Sort for [notes] = [LP label not on advance shipment notification] to find that sub-type. 

    a. Look at the carton images provided to determine the same as the above. 

    b. Check the ASN data for the LP label

  3. Sort for [notes] = [GTIN-14 Gold List missing] to find that sub-type. 

    a. Check the Gold List to see if the GTIN-14 barcode is actually missing. 

How to Research the Non Compliant Barcode Issue Type

Unlike the other four, this issue type has no sub-types. Instead of researching these in the operational performance sheet, Amazon recommends the following measures:

  1. Use the ASIN to check whether the UPC used is linked in the catalog Items > Catalog

  2. Use the ASIN to check your inventory and ensure that item barcodes are applied and accessible. Confirm that item barcodes are not placed around corners or curves on the product. For cylindrical shaped products, ensure that the barcode is placed vertically around the cylinder

  3. When the ASIN is SIOC or when the outer carton represents the individual sellable ASIN, ensure that the MasterPack/shipment carton has a scannable item barcode.

  4. The printer used to create the item labels is in good condition; printed labels are not faded, smudged, or against a shiny background. 

How to Dispute an Amazon Chargeback

Once a chargeback is understood, it is best to think of the fine as a symptom of future issues as well, as the first in a series of chargebacks that will recur indefinitely until some sort of change takes place either on the vendor or retailer side.

All chargeback disputes are handled by the Vendor Chargeback Dispute Management (VCDM) team. NOTE: this team is not the same as the Vendor Case Management(VCM) team, which deals with general requests and questions.

Amazon breaks its chargeback dispute process down into three "rounds."

Round 1: VCDM

All disputes must originally go through the Vendor Chargeback Dispute Process with the VCDM team.

Once all of the required evidence has been collected, the chargeback can be disputed. Suppliers have only 30 days from the charged date to file a dispute.

After the dispute has been filed, there is another 30-day window in which a member of the VCDM team will review the dispute and get back to you. If the dispute is accepted, there is no need to continue on to Rounds 2 and 3. 

Round 2: VCDM (Again)

If the chargeback dispute was rejected the first time by the VCDM, there is yet another 30-day window in which the supplier can dispute the same chargeback again, also through the VCDM.

Oftentimes, the VCDM team will request further information or documentation for clarification and advise the supplier to resubmit.

If the dispute is accepted, there is no need to continue on to Round 3. 

Round 3: VCM

If the first two attempts with the VCDM are still unsuccessful, the third will have to be made through the Vendor Case Management (VCM) team.

To create a dispute with the VCM team, you will need to open a new case by clicking the drop-down "I don't understand why my dispute was denied."

NOTE: Amazon may be in the process of removing this third step entirely from the dispute process.

The VCM team is not authorized to approve payback for a chargeback. Rather, they are there only to check if the VCDM reasons were legitimate or not. In other words, the VCM team member will either review and deny again (making the dispute finally unwinnable) or review and escalate for the chargeback owner to consider paying back. 

A Few Notes on Chargeback Disputes

Dispute rejection reasons are pretty generic because the standard operating procedures have to cover a lot of different scenarios and thus, a detailed answer tailored to your case cannot always be provided.

If an Amazon supplier contacts VCM without going through the full two disputes with VCDM first, VCM is directed to reject the case and ask the supplier to go through the proper dispute process.

Suppliers must take action and dispute in a timely manner. If they fail to dispute a chargeback within the allowed time window of 30 days, VCM is directed to reject the case.

In some cases, VCM will tell suppliers something different from what VCDM did or communicate incorrect conclusions that the chargeback will be waived. Amazon attempts to be constantly training the associates to prevent this from happening.

How to Avoid Common Amazon Chargebacks 

There are a variety of what Amazon calls "common failure modes" to watch out for in each of the five major issue types. 

How to Avoid PO On Time Accuracy Chargebacks

Having products immediately available for fulfillment is key. Having the Freight Ready Date (FRD) and/or the First Carrier Requested Delivery Date (CRDD) within their respective windows (depending on the shipping method) will be key to avoiding "On Time" chargebacks.

For products that are not immediately available, Amazon has a few recommendations:

  • If the PO allows back orders (B/O), confirm the line item as B/O with the number of units you are able to fill, keeping in mind the grace threshold (B/O units still count against on-time performance).

  • Provide an Estimated Ship Date (Collect) or Estimated Delivery Date (Prepaid) for the line item.

  • Do not change the PO status code from a B/O code to an accepted code when you ship the items

  • If the PO does not allow B/O, reject the line item

  • Unknown fulfillment availability, reject the PO

How to Avoid ASN Accuracy Chargebacks

Because ASN Accuracy is an electronic procedure, the method for avoiding ASN Accuracy chargebacks is deeply connected with the research process (review the How to Research ASN Accuracy issue type section of this article).

In sum, suppliers can best avoid ASN issues by having oversight and mastery of their shipment and ASN timing. As a general rule, sending the ASN at the same time that the product leaves the supplier's facility is a good bet. So, for They-Pay/Prepaid, that would be at the time the shipment is sent, and, for We-Pay/Collect, that would be when the shipment is picked up. 

How to Avoid Carton Content Accuracy Chargebacks

In some cases, a scannable item barcode on the case pack or master pack causes misreads and further receiving/compliance issues. Basically, distinguishing between labels and barcodes, according to Amazon's compliance regulations, is ideal for avoiding that particular issue.

Sometimes when there is transparent packaging, a single item barcode gets scanned instead of the packaging label, resulting in Amazon believing that they have been short-shipped. This error can be avoided by making sure single item barcodes are not visible at any stage of the receiving process.

Another common issue is a missing ASIN. Keeping the ASIN mapped to the carton in both the ASN and the carton is key for avoiding these chargebacks. Keeping the item barcodes linked with the ASIN in the catalog is key to avoiding miscommunication and compliance errors. 

How to Avoid No Carton Content Label (no CCL) Chargebacks

Amazon lists "No accepted carton label is recognized on the carton" as the first failure mode of three and then lists a number of potential causes for that failure mode:

  • No label placed

  • Label ink faded

  • Label placed on a seam

  • Label damaged

  • Tape on the label

Also, if the carton label used does not appear on any ASN, it may be flagged for this sub-type. This may be because the SSCC or AMZNCC barcodes are not under the ASN when the carton is received. It could also be that the GTIN used is not a registered GTIN14 in the Amazon GTIN gold list. And, finally, it could also simply be that the BPS barcode used is non-compliant.

On the receiving side of things, if FC associates place internal identifiers that link cartons to a shipment over carton labels, a shipment could also be misread. Amazon believes that this is rare. The images provided for these should make them fairly easy to dispute. 

How to Avoid Non Compliant Barcode Chargebacks

Amazon lists three primary failure modes for this particular issue type:

  • The barcode is missing

  • The barcode is defective and unscannable

  • The barcode is not mapped on the ASIN's catalog

In the end, this issue type works sort of as a catch all for barcode problems. If the receiving issue can't be broken down into a PO, ASN, label, or content problem, this issue will be triggered. The key to avoiding this issue is following Amazon's standard operating procedure for barcodes.

TL;DR and How SupplyPike Can Help Amazon Suppliers

In sum, chargebacks at Amazon come in many different shapes and sizes. The variety of disputing methods varies as much as the kinds of chargebacks do.

This article covered chargeback research and disputing at a high level, five common chargeback issue types, how to dispute them, and how to avoid them in the future.

Get more helpful educational content like this by subscribing to our newsletter, Welcome to Vendorville, at supplierwiki.supplypike.com. We have a variety of resources, from eBooks to webinars and articles, on all things related to being a vendor at Amazon.

If you are interested in saving revenue in Amazon by avoiding and auto-disputing Amazon chargebacks, schedule a meeting with a team member to see if SupplyPike's solution is best for your business.

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Written by Shawn Oleson

About Shawn Oleson

Shawn is the Retail Insights Manager for Amazon at SupplyPike. His experience supporting 1P brands at Amazon helps our teams build a quality product for our customers.

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Shawn Oleson

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