What Amazon flagging high-risk orders means for Sellers
Updated: Nov 25, 2022
Amazon has begun flagging orders that of a high risk of being “lost” or “not received” using machine learning technology.
The online giant has developed a system that analyses hundreds of signals including delivery problems, item value and delivery address.
Once detected, those items deemed high-risk have a recommendation to send them requiring signature confirmation. If Sellers proceed with the recommendation, the cost of the signature confirmation service will be added to their shipping fee.
On the face of it, the policy looks like one that could protect both the customer and Sellers from potential problems further down the line. But it has prompted a host of questions and concerns from Sellers since being announced, as Thompson and Holt managing partner Craig Gedey explains.
Gedey said: “We have had many Sellers contact us with worries about Amazon’s new high-risk policy. One of the main ones has been that Sellers already have coverage for delivery issues when using Amazon Buy Shipping. They don’t then want to spend further money for extra coverage on delivery issues.
“They also want to know whether if an item is flagged as high-risk and they chose not to pay extra for the signature confirmation service, will the parcel still be covered by the Item Not Received coverage that Amazon puts in place.
“Some are even asking whether they are covered under INR if they do take the signature confirmation service and something still goes wrong, such as a delivery driver accepting the incorrect signature.
“At Thompson and Holt we’ve identified further possible concerns. If a delivery address is shown to have issues, should Amazon be clearing deliveries to it at all if it adversely affects Sellers? Should the Seller have the option to cancel the order once it is flagged as being high-risk?
“And if Amazon is so keen to implement this system, should it not be the buyer who funds the extra cost rather than the Seller? There is also the possibility that some buyers might not want to use the signature-confirmation system, and it is being forced on them. Some simply don’t like being inconvenienced by that.
“So what might look like a solid policy in principle has actually prompted more questions than answers for many Amazon Sellers. It will be very interesting to monitor how this unfolds in practise in coming weeks and months because the concerns from Sellers are very real ones.”
This is the new Amazon policy in full:
Effective Jun 23, 2022, Amazon recommends adding "signature confirmation" to orders with a high risk of being reported as "not received" or "lost".
You can purchase "signature confirmation" service when you select shipping for these orders in "Buy Shipping".
How the service works:
1. Our machine learning technology identifies high-risk orders by analyzing hundreds of signals, such as delivery problems, item value, and delivery address.
2. High-risk orders will be flagged on your Manage Orders page under the "Order Status" column with a "signature confirmation recommended" message.
3. If you proceed with the recommendation, the cost of the signature confirmation service will be added to your shipping fee.
4. If a buyer reports a signature-confirmed order as "lost" or "not received," we will conduct additional checks on that buyer’s account. Any refunds or claims we grant without your involvement will be eligible for appeal.
The signature confirmation recommendation is offered to sellers at no cost. However, signature confirmation implementation is a separate carrier service for which carriers charge an additional fee.
The service charge varies by carrier, but on average costs between $3 and $6 for each order.
You will be responsible for the additional shipping costs incurred for implementing the signature confirmation recommendations.
If you have found yourself suspended while selling on Amazon, contact Thompson and Holt for a free LiveChat to get your Seller business back online as quickly as possible.