Amazon Warehouse, previously Amazon Warehouse Deals, is a legitimate account. Displaying and acting like a 3P seller, Amazon Warehouse is the platform where Amazon will resell damaged or lost FBA goods.
What Are Amazon Warehouse Deals?
Amazon Warehouse Deals are product offerings from Amazon. This account is listed just like any other seller, but is only for used, refurbished, and open package products. The inventory being offered by Amazon Warehouse is not coming from a vendor source, but has been purchased or obtained via other means.
Can Amazon Warehouse Compete for the Buy Box?
No, they cannot. Amazon Warehouse offers will not compete for the Buy Box, nor will they run ads. They also will not impact your chances of winning the Buy Box, your eligibility, or Brand Health.
This also means customers have to actively look for deals. They can either visit the Amazon Warehouse store, or they will have to click on the “Available from these Sellers” or “Other Buying Options” links on the listing itself. There are certainly some buyers who will take these steps, but for the average consumer you probably don’t need to worry too much if you already have the Buy Box.
How Does Amazon Warehouse Get Inventory?
Inventory is acquired from FBA sellers. Typically this is damaged inventory that has been moved to unsellable, which includes returns. If you perform a removal order for disposal on your unsellable inventory, Amazon reserves the right to review if your inventory is OK for resale. They will refurbish the item, and typically list it at a discount.
However, there are 2 other sources of Amazon Warehouse inventory. Damaged goods that Amazon takes responsibility for & lost items.
Damaged goods that Amazon takes responsibility for do not necessarily go into your unsellable inventory. You are typically reimbursed for this inventory (for your list price less all applicable fees, just as if you had sold it). Since Amazon has paid you for the inventory, they now own it and can attempt to refurbish & sell the unit.
Items lost in the warehouse fall under the same umbrella. Amazon takes responsibility for the lost item & reimburses you. If they find the lost item they can either reverse the reimbursement or retain the inventory they paid for.
Usually for Amazon to list a Warehouse Deal, they will have a small cache of inventory for a given ASIN. They do not do one-offs. So if you lost 1 unit, they are more likely to do a reversal. If you lost 50 units, they may just sell them off.
I Don’t Have This Item in FBA
It is possible Amazon Warehouse carries one of your products, even if you don’t use FBA. This could be because you used FBA previously and switch. It can also be if you have 3P competition who use FBA. Since FBA is not limited to brand owners, it is good practice to keep your channel clean in order to prevent these offers popping up due to 3P inventory.
How Does Amazon Refurbish Items?
Normally, this is as simple as fixing or replacing packaging. Sometimes a little more work goes into it, and they may replace batteries or parts.
How Can I Opt Out?
Unfortunately, you can’t. This is just part of the cost of selling on Amazon. However, there are actions you can take to help mitigate this:
Removal vs Disposal Orders
Amazon will move unsellable inventory into it’s own area of the warehouse. After 30 days you need to chose what to do with it. Most sellers will automate this procedure, and either have unsellable units returned to them for inspection, or allow Amazon to dispose of them. Returning units lets you determine if any units are resellable, and take any necessary steps to ship back in to FBA. But disposal allows Amazon to do the same thing, and resell the units under Amazon Warehouse.
Opting-out of FBA Refurbishment
Opting-out of FBA Refurbishment may help mitigate the situation, as you are telling Amazon not to refurbish your products. However, FBA Repacking is not optional, and Amazon determines by category which products are enrolled. The only work around here is choosing returnless refund, but that only prevents customer & carrier damaged items from making their way back to FBA. Anything damaged in the warehouse, or lost and then found by the warehouse, could still become an Amazon Warehouse Deal.
Merchant Fulfillment / Seller-Fulfilled Prime
You can also just keep your inventory out of Amazon’s hands. Most sellers use FBA to get the Prime badge, and usually because it’s easier to let Amazon handle bulk orders. However, if your warehouse can handle the load, you could look into merchant fulfillment. If you have a good track record & can adhere to Amazon’s metrics, Seller-Fulfilled Prime is a viable option to retain the Prime badge while not having to use FBA.