Seeking Feedback on Potential Legal Action Regarding Amazon’s Sourcing Cost Policy
Dear Sellers,
I am formally considering initiating legal proceedings against Amazon UK concerning their FBA Lost and Damaged Inventory Reimbursement Policy, specifically the handling of sourcing cost reimbursements.
Background:
Under the current policy:
Amazon reimburses lost or damaged inventory based solely on sourcing cost, explicitly excluding shipping, handling, customs duties, preparation costs, and lost profits.
Amazon reserves unilateral discretion to reject seller-submitted sourcing costs in favor of its internal estimates, without requiring supporting documentation or justification.
Amazon retains the right to dispose of or resell inventory after reimbursement, even where the item was reimbursed at a value significantly below its actual cost.
A per-unit cap of £2,000 applies, irrespective of the actual economic loss or incurred costs.
Legal Concerns:
I believe these practices may constitute:
Unfair contract terms under the Consumer Rights Act 2015 and/or the Unfair Contract Terms Act 1977, as the terms impose a significant imbalance to the seller’s detriment and are non-negotiable.
Breach of contract, as Amazon fails to fully compensate sellers for losses incurred while goods are in Amazon’s custody.
Unjust enrichment, given Amazon’s ability to profit from reimbursed inventory sold at below its actual value.
Potential violations of UK common law principles on remedies for loss and damages, as sellers are not restored to the position they would have been in absent the loss.
Request for Feedback:
I am seeking input from other sellers who have experienced similar issues with Amazon’s sourcing cost policy. Your experiences, evidence, or documentation will be considered as supporting evidence of systemic unfairness in the policy, which I intend to present as part of a legal claim in UK courts.
Any contribution you can provide will be invaluable in demonstrating the widespread impact and potential illegality of this policy.
Thank you for your time and cooperation.
KInd Regards,
JD
Seeking Feedback on Potential Legal Action Regarding Amazon’s Sourcing Cost Policy
Dear Sellers,
I am formally considering initiating legal proceedings against Amazon UK concerning their FBA Lost and Damaged Inventory Reimbursement Policy, specifically the handling of sourcing cost reimbursements.
Background:
Under the current policy:
Amazon reimburses lost or damaged inventory based solely on sourcing cost, explicitly excluding shipping, handling, customs duties, preparation costs, and lost profits.
Amazon reserves unilateral discretion to reject seller-submitted sourcing costs in favor of its internal estimates, without requiring supporting documentation or justification.
Amazon retains the right to dispose of or resell inventory after reimbursement, even where the item was reimbursed at a value significantly below its actual cost.
A per-unit cap of £2,000 applies, irrespective of the actual economic loss or incurred costs.
Legal Concerns:
I believe these practices may constitute:
Unfair contract terms under the Consumer Rights Act 2015 and/or the Unfair Contract Terms Act 1977, as the terms impose a significant imbalance to the seller’s detriment and are non-negotiable.
Breach of contract, as Amazon fails to fully compensate sellers for losses incurred while goods are in Amazon’s custody.
Unjust enrichment, given Amazon’s ability to profit from reimbursed inventory sold at below its actual value.
Potential violations of UK common law principles on remedies for loss and damages, as sellers are not restored to the position they would have been in absent the loss.
Request for Feedback:
I am seeking input from other sellers who have experienced similar issues with Amazon’s sourcing cost policy. Your experiences, evidence, or documentation will be considered as supporting evidence of systemic unfairness in the policy, which I intend to present as part of a legal claim in UK courts.
Any contribution you can provide will be invaluable in demonstrating the widespread impact and potential illegality of this policy.
Thank you for your time and cooperation.
KInd Regards,
JD
6 replies
Seller_w9VI3UyAR7oxH
even worse for handmade sellers because most of the value of the item is in the time spent making the item , which is even harder to prove .
Seller_l9DWGFvAaJQ2I
I would remove 'lost profits' from that, as you will struggle to justify claiming for profits you haven't actually made or 'could make once sold'. Lost/damaged reimbursement would be for exactly that, not extras.
Jolly good luck to you, it's a brave person who takes this on! (meant sincerely not sarcastically!)
Seller_vneMypCZkP1Zo
We do not get reimbursed back our sourcing costs fully either, but in addition, the amount also changes as what's ultimately approved. For example, what we have seen to be appoved versus what's paid can be two separate amounts. Also, when claiming for lost FBA shipment inventory they don't always approve the document that they've approved on a previous occasion either.
Hope it goes well, there are many other elements of the Amazon selling experience to pursue too, but this is a good one to get started with.
Seller_PAoOCZ5pKszVP
I would also argue that I am really uncomfortable sharing my sourcing cost with Amazon, knowing full well that they can go and then win the business themselves, or manufacture a similar product at a lower cost. I think it is confidential business information which they should not be asking for, yes probably anti-competitive.
If the error is Amazon's then they should be reimbursing in a different way, not asking for the sourcing cost. As someone else pointed out, the amount of work gone into getting that stock to Amazon, and prepping it with labels etc. we lose a lot of money at sourcing cost.
The reimbursement cost should be at or close to retail price. That would be fair.
Seller_zkETYNYu5AkMT
Please take a Class Action Suit against Amazon in U.K and E.U courts.
