hey it's patti scharf CPA and co-founder of catching clouds the leader in e-commerce
accounting today I want to talk about Amazon and specifically their sellable
versus unsellable inventory all right so there always returns when you're selling
on Amazon it's just kind of a fact of life all right so what happens is when
people send back their products Amazon will take a look at them and they will
put it into one of two categories either sellable or unsellable if it goes to
sellable whether the people who bought it originally whether they used it or
not or turn it back in pristine condition Amazon will just resell it
sometimes it'll sell is used sometimes new you're kind of it's kind of a
crapshoot and there's nothing you can do about it Amazon just does whatever
they're going to do so what ends up happening is if there are some products
that are sellable but they're kind of a little bit used you might get some
negative feedback on your listing from customers who like buy the used products
as one would expect but that's just kind of it's kind of what happens when you're
selling on Amazon okay so that's what happens with sellable however if the
products are damaged and damaged enough it will go to unsellable they used to
have a service I think they maybe still do where it's kind of an inspection
service where they can inspect the products they can maybe you know gussy
it up a little bit and make it look nicer and turn it into sellable so you
can still turn around and sell that product otherwise if it's just totally
trashed then they'll just trash it but if it's it could be resold or you know
Amazon's really not quite sure what to do with it they think it's unsolvable
but but they want to know what you want to do with your products this is where
you come in with everything that's remaining in unsellable you have to make
an active decision on how you want Amazon to
handle your inventory whether you want to dispose of it or you want to remove
it if you dispose it and you tell Amazon yes
dispose it here's what happens Amazon says great they take ownership of the
products you have like relinquished responsibility for that they will take
it and what they do is they get a gigantic container and they throw those
products in there anyone from cellar ABCDE they throw all into a container
and there are some buyers out there who will go and they will buy this build
container sight unseen and they're taking their chances that there are
actual products that they can clean up and sell that are in there and what they
will do is they will turn around they'll relist them on Amazon they may list them
on your listing and then when it goes to the customer if the customer doesn't
like it and think that they're getting ripped off they will send it back again
and they may leave negative reviews on your listing so that is something to be
aware of when you dispose of products however if you decide to remove products
Amazon will say great got it no problem and they will send it back to you now
when you sent in all your products the first time chances are you sent in a
giant like the whole bushel of products you sent it to them so you got some
discounts and stuff on shipping when it comes back to you it's gonna be coming
back one by one and even though Amazon may get stuff out
to customers really quickly when it comes back to you it's gonna take 3060
days maybe even longer so it's coming out piecemeal one by one it's coming
back really slowly it's coming back you know it's going to be more expensive the
shipping when it comes back to you but the good news is you know what's
happening with your products you you know for sure it's in your own
possession nobody else is going to be relisting substandard products on your
listing all right so here's what you need to do you need to decide whether
you want to dispose of the products or remove the products
and in Amazon seller central you can set a setting that will tell it to always
dispose or always remove whatever it is your preferences or you you can set none
of those and you can just make a decision on a case-by-case basis and
when you do that I would recommend that you do that at least weekly go in there
check stuff out make your decision on how you want to handle your products but
here's the thing you're not going to be able to see like snapshots or unit by
unit information you you're gonna have no visibility into what these products
look like so you should probably just make an educated decision on what it is
you want to do with your inventory once it's being returned back to Amazon
because what you don't want to have happen is you don't want it to sit in
unsellable inventory for weeks months years because once you pass that year
threshold Amazon's going to start charging you long term storage fees
which are like ten times as high as your regular storage fees so this is
definitely a decision you want to make and you want to take an active approach
on it one last comment for you is when you have made decisions around your
inventory and you know that you're getting rid of product whether it's
disposed or whether you're removing it make sure that you let your accountants
know what you're doing with it let them know the quantity of of units that
you're getting rid of what the SKU is what the original cost is so that they
know how to treat that in your financials because you may have some
numbers that are like artificially too high or low depending on assumptions
that they're making if you don't give them the actual detail to make good
educated choices in keeping your finances up to date
I think that's it if you have questions let me know leave comments down below if
you've had any experience with like positive or negative with any of these
products that have been returned share it with others people like to hear about
what's going on out in the world so I hope you like my video if you did please
like comment and share if you haven't already please subscribe and I'll catch
you later