(This is a guest post from our friends over at Payability, a finance company that helps marketplace sellers take control of their cash flow issues and finally grow their businesses.)
With an Amazon unavailable balance*, you’re not getting paid in full or on time, so your cash flow is more strapped than usual and you can’t effectively grow your business. But there is a light at the end of the tunnel. In this guide on all things unavailable balances, we break down what it is, why you might get one, and what you can do to prevent and overcome it.
Amazon Unavailable Balance: What It Is and Why You Have One
Amazon typically issues payments every 14 days. When you have an unavailable balance, Amazon holds all or part of your payment for longer. How much they hold and for how long depends on a variety of factors. For one thing, there could be several reasons for your unavailable balance and each one has its own resolution time.
For example, a delivery issue or delay will prevent Amazon from issuing payment when it usually would — in other words, Amazon waits seven days post-delivery to pay you in case a customer wants to make a return, but if it’s been seven days and they haven’t gotten delivery confirmation, you won’t get payment yet.
Other reasons for an unavailable balance come back to your overall account health. Have you gotten A-to-z Guarantee claims or chargebacks? Is your account under review? Have your seller performance metrics dropped? All of these things could lead Amazon to hold your payment and resolutions can take 14 days or longer depending on your specific situation.
To learn more about the reason(s) for yours, visit the Account Health page in Seller Central.
How to Avoid an Amazon Unavailable Balance
The strategies that can help prevent an unavailable balance are the same strategies that will help your business grow, so chances are you are already doing (or attempting) them. Take this three-pronged approach as an example:
Self-Audit Your Account: Your account should consistently be in good standing — and you’ll want to catch red flags before Amazon does. To do this, run your own account reviews to make sure everything is running smoothly. Take a look at your sales history, performance ratings, customer feedback, fulfillment, return rates, etc. If anything needs improvement, address it ASAP. .
Optimize Sales Strategy: Think about what you’re selling, how much you’re selling it for, and how you are actually marketing it. Is your product category prone to returns (like clothing or shoes, which people tend to return due to size/fit issues)? Are you setting competitive prices that actually attract sales? Are your listings thorough and accurate (and thereby letting customers buy with confidence so they don’t return or file a claim because expectations weren’t met)? Asking yourselves these questions can help ensure that you are setting your business up for success. Pro Tip: if you need help in any of these areas, check out how Sellerapp.com can help you optimize sales, marketing and operations to really grow your business.
Maximize Cash Flow: Having steady cash flow allows you to be nimble in business. For example, if sales spike and you need to replenish inventory sooner than expected, you’ll be able to place a rush order without stocking out or risking an unavailable balance. If you want to outsource fulfillment to FBA or another third-party, you need cash to pay the fees. Whatever the case may be, cash flow allows you to manage your business’s day-to-day needs, invest in inventory and other growth opportunities, and take your business to the next level. Without it, you risk your “good standing” and could wind up with an unavailable balance. For more cash flow help, continue to the next section.
Maximizing Cash Flow to Overcome an Amazon Unavailable Balance
Unavailable balances can wreak havoc on your business’s growth. After all, when your cash is tied up with Amazon, you can’t meet expenses, turn inventory, invest in big opportunities, etc. What’s even more frustrating is that you can’t always plan around an unavailable balance since you don’t know for certain when your payment hold will be lifted. To overcome all of this, try one of these cash flow solutions:
Credit cards. Open a business credit card or ask for a spending limit on your current one. You’ll have more spending power and can bridge cash flow gaps in the short-term. Just don’t forget to use your credit card responsibly so you can still make payments on time and avoid costly interest charges.
Loans. Look into a bank loan — or an online business loan, which tends to be more suitable for small and online businesses. In short, banks have very low approval rates for small businesses and their application processes can take weeks or months — and let’s be honest, when you have an unavailable balance, you don’t have that kind of time. Online lenders offer loans up to $250,000 with short payment terms (often maxing out at 2 years). Interest rates tend to be higher than what you’d expect from a bank, for example, but their application processes are simple and fast, often involving same or next day approvals and funding.
Savings. If you have a savings account, you could dip into it as needed while your unavailable balance is resolved. While you’ll have immediate access to money (and won’t have to worry about an application or interest), it’s not an endless supply of funds. Not to mention, your savings should really only be used as a last resort.
Suppliers. Have you ever tried negotiating with your suppliers? If you have a good track record with them, they might be willing to extend your payment terms or give you a temporary break on payment while you work through your available balance. But keep in mind that your available balance might still be active when your new payment date approaches.
Alternative Finance Options. One alternative finance option that might make sense for your business is using Payability, which is a financing company designed specifically for marketplace sellers and their Instant Access product is a great long-term solution for cash flow issues like an unavailable balance. With Instant Access, Payability buys your closing balance from Amazon each day and then gives you 80% of it for a small flat fee the next day (the remaining 20% is kept on hold in case of chargebacks or returns and will be paid out to you on your normal payment schedule). At the end of the day, Payability get you paid the next day, every day.
If you’ve never heard of Payability, they have other cash flow solutions, too. With Instant Advance, you’ll get a large lump sum of cash up front (usually one month’s worth of receivables) and with the Seller Card, you can get immediate and on-the-go access to your funds 24/7/365 (including weekends and holidays). The application process is simple, decisions are based on your account health and sales performance, and funding occurs in 24 hours. So if you have an unavailable balance today, Payability can help you overcome it tomorrow.
Since 2016, Payability helped thousands of marketplace sellers take control of their cash flow issues and finally grow their businesses. To learn more about how you can be one of them, visit www.Payability.com.
*Disclaimer: Payability does not claim to have inside information on how and when Amazon releases payments. This post is based on publicly available information and observed trends.
About the Author
Victoria Sullivan is a Marketing Manager at Payability. She has over eight years of social media, copywriting and marketing experience. Prior to joining the Payability team, Victoria developed social media content and strategies for top technology brands such as Skype and Samsung. She holds a degree in Advertising from Syracuse University’s S.I. Newhouse School of Public Communications. She can often be found in a yoga class or working on her fashion blog.
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