Amazon's New Policy: Sellers Keep Damaged Inventory
Amazon has rolled out significant changes to its seller policies, aiming to enhance transparency and consistency. The updates, which took effect on March 31, 2025, after a delay, introduce a new damaged inventory ownership program and modify reimbursement calculations.
The new program, FBA Damaged Inventory Ownership, lets sellers keep Amazon-fault damaged inventory instead of receiving reimbursements. Units are marked as 'defective' and added to sellers' unfulfillable inventory. Sellers can manage these units manually or use automated settings. This program integrates with Amazon's FBA Grade and Resell service, allowing enrolled units to be resold through this channel.
The policy change affects inventory tracking and reporting. Enrolled inventory appears in unfulfillable inventory with 'Defective' disposition status. Amazon also shifted compensation calculations for lost or damaged inventory before customer orders from retail pricing to manufacturing costs.
These changes are part of broader strategic shifts in Amazon's marketplace governance, following recent updates like product title formatting changes, category restrictions, and advertising platform modifications. Sellers must now navigate complex decision matrices, choosing between retaining control over their products or receiving reduced financial compensation based on manufacturing costs.
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