As one of the important Amazon performance metrics, Cancellation Rate should be taken into consideration when it comes to selling on Amazon. Sellers have to maintain cancellation rates as low because high cancellation rates lead to suspension of the account.
The article is going to provide a useful guide for sellers to understand better about Cancellation Rate and keep a check on their Amazon accounts’ cancellation rate.
What Is Cancellation Rate (CR)?
The Cancellation Rate (CR) is the total number of orders cancelled by the seller before shipping to the customers during a given 7-day time period. The cancellation rate is applicable to seller fulfill orders only.
Pending orders or items that are cancelled by the customer directly on Amazon are not included.
According to Amazon policy, the CR needs to be maintained under 2.5% to keep on selling on Amazon else your account will be suspended.
Why Is It Important To Reduce Order Cancellation Rate?
A customer invests a huge amount of time to select a product out of a million products and a simple cancellation from your side gives a headache to him/her.
The customer feels betrayed as precious time has been wasted and again, she or he has to do the same research to order the same product. This also raises a question on the seller’s reputation and its services that ultimately lead to financial loss.
Moreover, if your order cancellation rate goes over 2.5%, you will surely lose your ability to sell. Above all, your financial stability gets hampered and you lost profit as well as loyal customers.
How to Reduce Order Cancellation Rate?
- Always keep your inventory up-to-date and accepts only as many orders as you can handle. Amazon knows that few order cancellation is unavoidable in the normal business scenario, but it expects you to minimize this customer-impacting practice.
- Ensure that all the listed products are in stock and available for shipment. When you cancel the order placed by customer before shipment, Amazon draws the inference that the product is out of stock.
- On-Time-Shipment – You must be committed to ship orders on time and improve on-time-shipment performance to minimise cancellations. Customers can become anxious if shipping the product takes a very long time and they may consider cancelling the order. Also, if the order is not shipped within a defined time limit, the order will be automatically cancelled by the system.
In the end, hopefully, the article will help you get some insight into Order Cancellation Rate in order to process your orders on time and reduce cancellations. To start delighting customers and grow your business.
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