The best way to keep track of how you’re performing as a seller is by keeping regular tabs on the Amazon Order Defect Rate (Amazon ODR). It is a simple performance metric that decides whether you’re a successful seller or not!
Or within the words of Amazon – “The Order Defect Rate (ODR) is that the measure of an Amazon Seller’s ability to produce an ideal Seller Experience.”
Amazon uses these ODR to rate the sellers on their customer service standards and their overall performance.
The Order Defect Rate on Amazon for a seller is calculated by including all the defected orders with a minimum of one or more defects divided by the number of orders received during a given 60-day period of time. A perfect seller’s Amazon Order Defect Ratio Must be below 1%
This raises a standard question – Why Must a Seller Work On Amazon Order Defect Rate-Improvement?
Amazon being the conglomerates, is extremely concerned about providing the simplest customer experience. Order Defect Rate is that the biggest factor that Amazon considers before promoting or demoting the sellers. So that they rate their sellers and therefore the one with the minimum order defect rate features a better chance of winning the buy box.
There’s also a downside of this feature that if the frequency of order defect rate on Amazon for a seller increases above 1%, it’s going to end in Amazon account deactivation & suspension.
An Amazon seller not only has got to remember the ODR but must also constantly work on Amazon Order Defect Rate Improvement.
To work up for Amazon Order Defect Rate-Improvement can be really challenging. You would like to possess a really strong knowledge of what’s the Amazon ODR, Factors that affect the Amazon Order Defect Rate, tips to enhance your order defect, and Amazon order defect rate ways to avoid account suspension.
It is often a tad tricky to understand where to start first, so allow us to start from the beginning.
What is Amazon Order Defect Rate?
The Rate of occurrence of negative metrics to the entire number of received orders within 60 days.
Or in other words, the Amazon Order Defect Rate may be a measure of the seller’s potential to supply the extent of customer experience.
What happens if your Amazon ODR reaches above 1%?
If your Amazon Order Defect rate increases above 1% this suggests you’re facing some serious selling issues.
The first of the many consequences you face is losing the buy box. All the buy boxes that you simply claim with the account are revoked as soon as your Order Defect Rate shots up to a quarter or above.
Secondly, you’ll lose all the products you’re liable for shipping. All the payments you’re holding are going to be transformed into refunds for the purchasers.
Lastly, and therefore the worst-case scenario of Amazon ODR reaching quite 1& is Amazon may end in your Amazon Account Suspension. It doesn’t matter how big or successful a seller you’re, a rise of 1% order defect rate can never be tolerated on a platform like Amazon.
Suspensions vs. Terminations
If your ODR is slightly above 1%, then you’ll receive a suspension. Your seller privileges are going to be removed but you’ll appeal it by providing Amazon with an idea of action for fixing the issues. It’s important to notice that Amazon reviews all appeals carefully; however, submission of an appeal doesn’t automatically guarantee reinstatement of your selling privileges.
For ODR’s that are greater than 1%, your relationship with Amazon is going to be in serious jeopardy. When a seller consistently features a lot of cancellations and/or late deliveries, Amazon could terminate your account completely.
How the Order Defect Rate on Amazon is calculated?
Amazon ODR is calculated by the subsequent formula:
Calculate Amazon Order Defect Rate (ODR)
There are many factors included to calculate the order defect rate
For Example, An Amazon seller Sam has received a complete of 1000 orders during two months (60 days). Sam did not successfully deliver 2 orders, 5 customers requested a chargeback and three customers posted a nasty review about Sam’s product.
Now for Sam, the entire defected orders are 2+5+3 which is adequate to 10. Now to calculate the ODR 10 is split by 1000 and therefore the rate comes to be 1%.
Factors Affecting the Amazon ODR:
Broadly, the share of orders with feedback during a limited time-frame decides the ODR.
Multiple negative signals on one order will only count together defect while defining the Amazon Order Defect Rate on Amazon
To make things much feasible, we’ve narrowed down 3 various factors that decide the defect rate of orders on Amazon:
- Negative Feedback Rate
- A-to-Z Guarantee Claim Rate
- Credit card Chargeback Rate
Negative feedback Rate:
This is the ratio of the number of negative feedbacks to the entire number of feedback on your products.
Usually provided by your customers once they fail to receive the precise product they wished for.
In other cases the products delivered won’t be within the perfect state – which means it’s going to be damaged or broken.
The third case arises if there’s a delay within the delivery of the products, quite expected.
Pro Tip: An Amazon seller must try their best to eliminate all negative feedback (if any). If some customer posts a negative review then try to get them either changed or removed ASAP.
A to Z Guarantee Claim:
Amazon monitors all the claims made by the buyers on their products. As soon as someone claims that they didn’t receive what was promised or the timely delivery, Amazon under A to Z guarantee claim is susceptible to pay a refund to the customer.
This creates an adverse effect on the reputation of the vendor and Amazon considers these products defected, thus increasing the defect rate. Amazon A to Z claims improve amazon defect rate.
An A to Z Guarantee claim is initiated in any of the subsequent conditions:
- The customer didn’t receive the package within the utmost estimated delivery date.
- The customer receives a special product than expected and has requested a return.
- You fail to resolve a refund issued by a customer.
Credit Card Chargeback Rate
Amazon keeps a record of the number of times a seller provides refund orders. Some people initiate a chargeback by informing their banks that they were wrongly charged for a transaction. The bank after primary verifications refunds the cashback alongside the extra seller fee.
So it becomes the responsibility of the Amazon sellers to decide if the case is worth issuing the refund or defending the motion.
If a seller fails to try to do so, it directly impacts the Amazon Order Defect Rate of your products.
So, so far, we’ve covered tons about Amazon ODR and therefore the factors causing them.
Now it’s time to maneuver on to the ideas on Amazon Order Defect Rate improvement.
Tips to enhance Amazon Order Defect Rate:
Respond to the Feedback at the earliest:
Being an Amazon seller, make it your responsibility to reply to your customers at the earliest. Customers attempt to communicate with sellers via feedbacks and it becomes your responsibility to answer these. Regardless of negative or positive feedbacks or the A to Z claims, ignoring these may jeopardize your Amazon Order Defect Rate. Attempt to come up with an answer as soon as possible because the longer you wait, the greater it’ll impact your Amazon seller rating.
Sell high-quality items:
Well, this needs not be mentioned that selling the simplest quality items will ultimately decrease the probability of things ending up as defective. To become a successful Amazon seller your focus should specialize on selling quality, not quantity.
Focus on providing an appropriate product description:
As a seller, it’s your responsibility to point out what you sell. Your product description must explain what your product actually is, instead of than attracting the audience with false appreciations.
Providing perfect Packaging:
Improper packaging causes the products to be damaged on the way to the customers. Make sure to pack your products consistent with the Amazon Product Packaging Guidelines.
By ensuring perfect packaging you’re directly performing on Amazon Order Defect Rate Improvement.
Shipping and Delivery Times Have To Be Perfect
The most important tip to enhance your Amazon Order Defect Ratio is by providing on-time shipping and delivery. You want to eliminate the shipping charges and supply free shipping on all products. The order must be delivered as soon as possible to the customers
Have an action plan to avoid Amazon suspension
The final step is to make sure you’ve got a solid plan in action.
More specifically, planning what your next step is and having steps for unexpected issues is going to be the simplest plan to ensure your account doesn’t get suspended.
Examine the causes of the notifications. Take an extended hard check out where you’ll potentially improve. Then, make certain you communicate your comprehensive solutions as effectively as possible. This goes straight into your Amazon account, confirm it represents you well.
Use our proven, 4 step system to make effective Plans of Action.
- Find out “What Went Wrong”. If there is a potential gap in your account operations, identify it concretely and be able to describe it, in as well described detail as possible. Look deep into your account and operations to seek out areas of improvement.
- State your root causes. Don’t just restate the rationale Amazon gave you. You would like to inform them WHY it happened.
- Layout your plan of attack. How will you resolve the issues that led Amazon to review your account? Could they reasonably annotate your account indicating that you simply understand what failed, and moved immediately to repair what broke? Think in terms of due diligence you have already got available. Is there any room for improvement?
- Putting it all at once. Get your best writer and editor on the work. This is often presumably getting to Seller Performance or Product Quality teams, and that they aren’t known for messing around. Put together a draft, then cast a skeptical eye on what you’ve got ahead of you. Have you ever stuck to the facts? Have you ever taken responsibility for the difficulty or issues? Have you ever stated your case clearly and concisely? Don’t send it off prematurely, then regret it. Catch on right on your first try time.
If Amazon thinks you simply have short-term solutions to try, then they likely won’t take your email seriously. They don’t want to investigate to have a look at your account again for the similar issues”.
If you discover that your selling privileges are removed, getting into touch with people like Chris can help guide you thru the steps that get you back on Amazon’s site, it’s certainly an honest way of getting an expert’s opinion.
In recent years, Amazon has made changes to its account suspension protocols, by asking online sellers to supply a pre-plan of action stating exactly what they were to try to avoid account suspension. Before, POA requests were only sent out of your Amazon account had been suspended.
You will presumably receive a warning email from Amazon stating that there is reason to believe your account is in danger of suspension. If you receive an email from firstname.lastname@example.org it’s advised that you simply don’t ignore it.
Avoid Amazon account suspension with inventory management software
It is often tough, stressful, and challenging to guard your Amazon seller status.
With an Amazon inventory management solution ready, however, you’ll manage your inventory in one location and make sure that your stock levels are automatically adjusted and synchronized across all of your additional selling channels.
In turn, this may remove the danger of overselling and delayed order fulfillment, both of which may cause account suspension on marketplaces.
Speedy order fulfillment can have a really positive impact on online reviews also, therefore inventory and order management software can help solidify your presence on Amazon and enhance your online reputation, increasing the likelihood of more sales and repeat purchasing.
It’s a win-win.
In short, Amazon order defect rate is an important threshold that every amazon seller must keep in check to keep the business growing. Hopefully, the above tips would help you keep your orders from getting negative feedback and improve your order defect rate. We at ReinstateAmz help amazon sellers to keep their amazon accounts up and running and solve the problems in no time so in case you want expert help to improve your order defect rate r reinstate the account that is suspended due to high order defect rate then we are just a call away from you!