On Amazon, 53 percent of the paid units were purchased through third-party sellers during the year 2021. This signifies that third-party sellers are the most dominant on Amazon’s website in terms of purchases.
As a seller who is a third party, you must comply with Amazon’s rules and policies to continue to sell on their platform. Your rate of order defects is among the most important metrics that you’ll need to keep track of and improve.
What is the defect in order rate?
The defect rate of an order is the number of customers who purchase defective goods within a specific time frame. To determine the defect rate, divide the number of defective orders by the total number of orders within the same timeframe.
This is among the most crucial metrics Amazon utilizes to evaluate the performance of your seller. They want to make sure that they’re providing the best customer service to their customers.
To measure your seller’s performance, they evaluate the defect rate of your orders to make sure you’re giving your customers a great experience.
You must keep up with the high-quality standards Amazon has established for sellers. It is vital to maintain a high quality of customer service for Amazon customers. This is the best method to continue selling on Amazon’s platform and to reach the most valuable customers.
When Amazon determines the defective rate they generally take a month to calculate it. This is to allow for defects to be addressed and appear in your account.
Here are the numbers to look for at the bottom of your account:
- Late delivery rate: below 4 percent
- Pre-fulfillment cancel rate: Below 2.5 percent
- Order defect rate: Below 1 percent
If your account reaches the above threshold or is higher than that, it could lead to an immediate suspension or the closing of your Amazon store.
What is the reason for an order to be defective?
When Amazon determines the rate of a defect in your order It is essential to know what factors it takes into consideration when formulating your rate. Three main aspects Amazon examines in calculating your rate
Credit card chargeback:
If someone wants the money back, it could influence the quality of your product. Customers request refunds for various reasons, including poor service, fraud or receiving damaged items, or not getting a refund on the return.
If the chargeback to your credit card is the result of an issue with your service provider, that could affect the defect rate of your order.
The buyer makes an A-to Z claim:
Amazon provides an A-to-Z assurance for those who purchase products from businesses that are selling through the market.
If your delivery hasn’t arrived on time or the product isn’t in good condition, the customer can make an Amazon A to -Z claim. If they make such claims, it can negatively impact the defect rate of your order.
Negative feedback:
If your customers leave bad feedback it’s an indication of bad customer service. An unsatisfactory customer experience can cause more negative feedback as well as high customer defect rates.
These are the major elements Amazon will consider when determining your order’s defects rate. It’s important to keep in mind there is only one possible defect for each order can be a possibility.
If someone is involved in an A-to-Z claim and then leaves negative feedback, it’ll only be counted as one negative experience instead of two separate claims.
What is the impact of Amazon order defects?
If the defect rate of your orders is greater than 1 percent, you’ll lose the status of a seller. Amazon will suspend accounts with a defect rate of above one percent in their defect rate on orders.
When your defect rate exceeds the threshold, Amazon strips your business of its Buy Box and removes it from your Buy Box, except for items listed as fulfillment by Amazon.
Amazon provides you with 17 days to rectify the situation and come up with an answer. It’s not as easy as declaring “it won’t happen again” or “I’m sorry I didn’t know the rules.” Amazon demands that you come up by implementing a plan to resolve the issue.
It is important to identify the areas where customer satisfaction is not up to par. Check out negative feedback and claims made by customers. Are there trends common to all that you observe?
The feedback in all cases may have a similar way that helps you identify the issue. It might be something easy that you can address. If you spot these patterns, you could make an improvement plan for your order defects rate. action plan to improve your rates.
It’s crucial to continuously be aware of how your customers perceive your company. If you can spot issues quickly and fix the issue, you’ll stop customers from experiencing a negative experience. This will help you avoid experiencing a high defect rate at all.
If you’re not giving your customers satisfaction, fewer customers will buy your product.
They’ll see your business has an unsatisfactory seller rating and will not feel confident buying from your company. A lower rating on the seller’s side results in fewer sales, which can lead to lower rankings for your products.
To avoid this being a reality, you must stay in touch with your target audience. This will allow you to understand what they think of your company and what you can do to enhance their customer experience.
This is especially important if are looking to stay an Amazon seller.
If the defect rate of your order increases significantly above one percent or is consistently over the threshold of one percent Amazon may suspend the account, and it may not be able to reinstate it.
