Amazon Order Defect Rate (ODR) — All You Need to Know
As an Amazon seller, your Order Defect Rate is one of the most important performance indicators to track. A high ODR may cause seller account suspension or even deactivation. But what exactly is the Amazon Order Defect Rate, and how do you determine your ODR?
In this post, we will discuss what Order Defect Rate is and how to calculate ODR on Amazon. We will also share practical insights on how to improve your Amazon Order Defect Rate.
What Is the Order Defect Rate on Amazon?
The Amazon Order Defect Rate (ODR) is a performance metric that Amazon uses to rate how well sellers provide customer service. Your target ODR must be under 1%.
ODR measures the percentage of orders that lead to a bad customer experience, like negative feedback, A-to-z claims, or chargebacks. Your ODR is calculated over a 60-day period.
Components of Order Defect Rate
Amazon applies three different types of metrics to measure ODR defects. Below is the list of these metrics with an explanation of what they mean.
Negative Feedback Rate
Negative Feedback Rate is the percentage of orders with a negative rating (1 or 2 stars) divided by the total number of orders in a specific period. A low Negative Feedback Rate shows that you are a customer-centric seller.
This metric is based on the order date, not the date the feedback was received. That means the Negative Feedback Rate may not match the feedback that buyers see. That is because it's calculated based on the feedback date.
If a buyer gives you negative feedback, find out why and work with them to fix the problem. You can contact the buyer through the Feedback Manager or Buyer-Seller Messaging templates.
A-to-z Guarantee Claim Rate
The Amazon A-to-z Guarantee Claim Rate is the percentage of orders with an A-to-z Guarantee Claim divided by the total number of orders. The rate is calculated in a 60-day period.
This metric measures how often customers have had problems with your sold orders. A-to-z Guarantee Claims that impact your ODR include customer claims that happened at your fault, when you canceled the order or refunded the buyer, and pending claims. Claims that weren’t your fault, denied or cancelled by the customer, don’t affect the ODR.
Credit Card Chargeback Rate
The Credit Card Chargeback Rate is the percentage of orders disputed by the buyer's credit card issuer divided by the total number of orders in a given period. This metric measures how often customers have used their credit card company to dispute your purchase.
There are three main reasons for chargebacks. The first type is when the customer says they didn't receive the order. The second type is when the customer doesn't get a refund for a returned product. The third type is when the customer gets a damaged or defective item.
Why Is Order Defect Rate Important?
ODR is essential for Amazon sellers because it is a measure of how often they are providing a positive customer experience. Amazon uses ODR to evaluate seller performance and determine who is eligible for certain benefits.
Buy Box eligibility
Buy Box is the featured spot on Amazon product pages that lets customers add items to their cart and checkout easily. Sellers with a high ODR are less likely to be featured in the Buy Box, which can lead to fewer sales.
Account suspension or termination
If your ODR is consistently high, Amazon may suspend or even terminate your account. That is because Amazon wants to ensure its customers have a positive shopping experience. Sellers with high ODRs are seen as being more likely to provide a negative experience.
Customers are more likely to buy from sellers with a good reputation. Customers are unlikely to go back to sellers with a high ODR, as it suggests the seller isn't meeting their expectations.
How Do You Calculate ODR?
Amazon monitors your ODR and expects sellers to maintain it below a 1% threshold. Therefore, keeping a close eye on your ODR number is crucial.
What is the formula for Order Defect Rate?
To calculate your Order Defect Rate (ODR), Amazon divides the number of orders with defects by the total number of orders over a 60-day period.
The formula for calculating ODR
For example, if you have 10 orders with defects and 1,500 total orders over a 60-day period, your ODR would be 0.67%.
How to find out my Order Defect Rate?
You can monitor your ODR in your Seller Central or download the ODR report.
ODR lookup step-by-step
Step 1. In your Seller Central side menu, go to Performance > Account Health.
Step 2. Under Customer Service Performance, click Order Defect Rate.
Step 3. To see the ODR report, click the Download Report button at the bottom of the page.
What Happens If Your ODR Reaches 1%?
Amazon requires sellers to have an ODR below 1%. That means less than 1% of your orders should have a defect, such as negative feedback, A-to-z claim, or credit card chargeback.
If your ODR is above 1%, Amazon may restrict your selling privileges, including suspending product listings that you fulfill yourself.
Account «At Risk»
If your seller account is at risk of deactivation due to high ODR, Amazon may offer you to take a quiz. You can pass a quiz within 72 hours. In such a case, you will see the banner at the top of your Account Health page. If you pass the quiz, you will not need to submit a Plan of Action (POA) to prevent account deactivation.
If your account has already been deactivated due to a high ODR, you can reinstate it by filing an appeal in your Seller Central. On the Account Health page, click “Submit Appeal,” follow Amazon’s instructions, and provide a POA.
How to Improve Order Defect Rate on Amazon?
There are a number of things you can do to improve your ODR on Amazon. If you are concerned about your ODR, follow the tips below to improve it.
Ship orders on time
Timely shipping is an important factor in ODR. Make sure you have a process in place so that all orders are shipped within the estimated delivery date.
Package orders carefully
Reliable order packaging will help prevent damage and returns. Use sturdy boxes and packing materials, and make sure to pack your items securely.
Provide excellent customer service
React to buyer inquiries quickly and take care of any issues promptly and efficiently. That will help to reduce the number of A-to-Z claims and negative feedback.
Review product details
Make sure your listing information, price, and offer details are correct and up-to-date. That will help minimize negative feedback and A-to-Z claims due to customer misunderstanding.
Monitor your ODR regularly
Check your ODR regularly to identify and address any potential problems early on. You can view your ODR in the Performance tab in Seller Central under Account Health.
FBA sellers typically have lower ODRs because Amazon is responsible for shipping and order fulfillment.
Sell high-quality products
If you sell high-quality products, you are less likely to receive returns and negative feedback.
What is an Order Defect Rate above 1%?
An Order Defect Rate (ODR) above 1% means that more than 1% of your orders have a defect, such as Negative Feedback, A-to-z Сlaim, or Credit Card Chargeback Rate. That can lead to restrictions on your Amazon selling privileges, including suspension of your account.
What is the maximum Order Defect Rate (ODR) allowed by Amazon for your account to avoid suspension?
The maximum Order Defect Rate (ODR) allowed by Amazon for your account to avoid suspension is below 1%.
What is the Order Defect Rate time window?
The Order Defect Rate (ODR) time window is 60 days. That means Amazon calculates your ODR based on the number of orders with defects over the past 60 days.
What is the Invoice Defect Rate for Amazon FBA?
The Invoice Defect Rate (IDR) for Amazon FBA is the percentage of orders from Amazon Business customers with the invoice not uploaded within one business day after shipment. Amazon targets sellers to maintain an IDR of less than 5%. Exceeding this threshold may result in account suspension or termination.
Your Order Defect Rate is an important metric because Amazon uses it to measure your performance as a seller. By keeping your ODR low, you can avoid restrictions on your selling privileges and provide a better customer experience.
A low ODR is beneficial for both you and your customers. It shows that you are committed to providing a positive shopping experience, and it can lead to increased sales and profits.
Remember that selling the right products is the best way to keep your ODR low and avoid negative feedback and A-to-z claims. You can find the winning products for your Amazon business with the help of product research tools. One of the most popular examples of such tools is Seller Assistant App. It’s a specialized product research extension that every seller must have in their arsenal. It combines all the features necessary to source the most profitable deals for Amazon. It offers an FBM&FBA profit calculator, Quick View, Stock Checker, Restrictions Checker, and a lot of other essential product research features, all in one tool.