New Amazon Charge-back: Down-Confirmed Units
There’s a new charge-back under PO On-Time Accuracy called Down-Confirmed. The charge-back is 3% of the cost of the product for the difference in confirmed units if that number is reduced 5 days after the start of the ship/delivery window. For example, if you confirmed 15 units but reduced that to 10 units after 5 days into the PO window, Amazon deducts 3% from the unit cost of the missing 5 units (Down-confirmed).
The charge-back is based upon the trailing 4-week average and only applies if more than 10% of your orders are affected. Because this charge-back is under PO On-time Accuracy, orders that arrive late and auto-canceled orders also affect the rolling 4-week average. Meaning, if you have a order for 100 units, you only ship 5 and adjust your order quantity to 95, those 5 will be considered down confirmed and apply to the 3% charge-back. The charge-back will be waived though because it only affects 5% of the order. If another 7% of that order then arrives late (outside your delivery window), your total PO On-Time Accuracy defects is 12% and a charge-back will apply.
Back-ordered units are also affected by the new charge-back. If you are going to back-order and item, or leave it open, its important to ensure you’ll be able to ship before the PO is canceled. If you change the quantity shipping after 5-days, including if you cancel the line item, you’ll receive the 3% charge-back.
The only way to waive this charge-back according to Amazon is if you encounter extreme circumstances such as floods, fires, extreme weather, and collect freight carrier cancellations/refusals.