Amazon just made a change that directly impacts margins, operations, and customer experience for every brand running Seller Fulfilled Prime or FBM.
All seller-fulfilled orders must now include prepaid return labels. No exceptions.
Previously, sellers could opt out of prepaid labels on certain high value or specialty orders. That flexibility is gone. This is now a blanket policy.
If you sell FBM on Amazon, this affects you immediately.
What Changed
Amazon now requires:
- Prepaid return labels for all seller-fulfilled orders
- No exceptions based on order value
- Faster and easier return experience for the customer
- Greater accountability placed on the seller
This aligns with Amazon’s ongoing push to make the buying experience feel identical to Prime, even when the order is fulfilled by a third party.
From Amazon’s perspective, this improves customer trust. From the seller’s perspective, it increases operational cost and complexity.
Why Amazon Is Doing This
Amazon’s north star is customer experience. Always has been.
Prepaid returns remove friction. They reduce buyer hesitation. They increase conversion rates. And they standardize expectations across the platform.
The downside is simple. Sellers absorb more cost and more responsibility.
This is part of a broader pattern we continue to see:
- Higher service expectations
- Higher operational burden
- Higher competition
- Higher need for optimization
Amazon is no longer a “list it and forget it” marketplace. It is a precision platform.
How This Impacts Sellers
1. Higher Return Costs
You are now paying for return shipping regardless of reason. That can erode margins fast, especially in categories with:
- High return rates
- Large or heavy products
- Apparel, supplements, beauty, or seasonal goods
2. More Pressure on Product Experience
Poor listings get punished harder now.
If your images misrepresent the product, your copy overpromises, or sizing is unclear, returns increase and you pay for them.
The brands that win will be the ones that:
- Clearly set expectations
- Use accurate imagery
- Have strong PDP clarity
- Address objections before purchase
3. Margin Strategy Becomes More Important
You can no longer afford to price products based only on COGS and outbound shipping.
Your pricing must now account for:
- Average return rate
- Return shipping cost
- Category norms
- Long term customer value
If your margins are already thin, this change forces a strategic adjustment.
The Opportunity Hidden Inside the Policy
Most sellers will react poorly. That creates opportunity.
Brands that treat this as a strategic lever instead of a burden will win share.
Here is how.
Use Returns as a Conversion Advantage
A frictionless return experience increases buyer confidence. That often leads to:
- Higher conversion rates
- Better reviews
- More repeat customers
- Stronger brand trust
If you pair this with strong PDP optimization, your net profitability can actually improve.
Optimize Listings to Reduce Returns
Smart brands will double down on:
- Image clarity
- Comparison charts
- Sizing guides
- FAQ sections
- Lifestyle use cases
- Expectation setting
Returns are often a symptom of confusion, not dissatisfaction.
Reevaluate FBM vs FBA Strategy
For some brands, this change makes FBA more attractive again. For others, a hybrid strategy becomes optimal.
There is no universal answer. There is only a correct answer based on your data.
What We Are Doing for Our Clients at CoreTrex
We are actively adjusting strategy across our client portfolio by:
- Analyzing return rate by ASIN
- Identifying listings causing the most friction
- Reworking PDPs to reduce confusion
- Adjusting pricing models to protect margin
- Reassessing fulfillment mix
- Building return cost into contribution margin modeling
This is not just a compliance update. It is a business model update.
Final Thoughts
Amazon continues to raise the bar. That will never stop.
The brands that win are not the ones that complain about the rules. They are the ones that adapt faster than everyone else.
If you are unsure how this policy affects your margins, your fulfillment strategy, or your long term growth, this is exactly the type of inflection point where expert guidance matters.
At CoreTrex, we do not just manage accounts. We build systems that keep brands profitable as the marketplace evolves.
If you want help pressure testing your current strategy, don't hesitate to meet with our team!
