There’s no way to sugarcoat it. The Amazon Seller Payment Schedule can be a major buzzkill for any ambitious eCommerce owner. You need to move fast to keep your stock flowing, stay ahead of the curve on seasonal sales, try out the latest marketing tricks, or expand into new markets. But to stop waiting for your Amazon payout, you’ll need cash.
Cash that’s likely still working its way through Amazon’s payout system.
It’s a legitimate problem for any successful eCommerce company. The sales have been made. The money is there. You just can’t reach it yet.
And that’s a problem.
Because while you’re waiting for your Amazon payout, your competitors are actively taking advantage of new exciting ways to win on Amazon. In this article, we’re going to recap the Amazon Seller Payment Schedule and help you review your options so you know exactly what to do when it feels like your hands (and cash flow) are tied.
First, Here’s How the Amazon Seller Payment Schedule Works
- The seller receives funds into their Amazon seller’s account.
- Amazon automatically traces this payment and places your funds ‘on hold’, usually for 7 days after the delivery date.
- Amazon disburses funds every 14 days.
- Amazon pays into a verified bank account. If your bank rejects it, Amazon will hold the payments until you solve the account issue. If you choose to change your bank account, it will activate a three-day security freeze before you can transfer money.
- You have the option to release funds via the ‘request transfer’ button. This option kickstarts the transfer of funds before the dates you’re usually paid. However, only the available funds that have cleared Amazon’s reserve period will be eligible for release.
Ready to stay behind the driver’s wheel with Amazon Marketplace? Check out our deep dive guide to the Amazon Seller Payment Schedule: The Complete Nuts-and-Bolts of How Payouts Work.
Now for that Pesky Amazon Unavailable Balance: Here’s What It’s All About
Your Amazon Unavailable Balance is also known as your Amazon Reserve or Seller Reserve, and it’s basically exactly what it sounds like.
When you see an unavailable balance in your seller account on Amazon, these are the funds that Amazon won’t release to you until the next disbursement (a.k.a. payout). The figure can contain some or all of the money owed to you. For example, any funds in your reserves that a chargeback or return has claimed.
While the Amazon payout process can cause many headaches for sellers, it’s actually a good thing. This process ensures there’s enough cash in the pot to handle any unforeseen issues with your purchases such as chargebacks, refunds, disputes, guarantee claims, etc.
It’s all part of Amazon’s commitment to keeping their (and your!) customers happy and while it’s great for serving that aim, unfortunately, this gap in sales vs. payouts leads to some very uncomfortable cash flow issues for Amazon merchants.
What If You Need Cash While Waiting for Your Amazon Payout?
Whether you need to secure a time-sensitive discount with a key supplier or lock in your inventory ahead of Chinese New Year, there are a million reasons why you may need cash on hand before your next Amazon disbursement. (We’ll discuss each one of these scenarios in detail below.)
Here are some of the most common options for navigating the Amazon payout cash flow gap:
Business Credit Card
- Benefit: When used strategically, credit cards can be great for buying yourself some time while taking advantage of points and cashback programs.
- Drawback: If you don’t pay it off in full before the payment date, you’ll likely end up spending way too much in interest.
Bank Loan
- Benefit: If your business meets the criteria, some SBA and bank loans offer reasonable interest rates.
- Drawback: Most banks don’t understand eCommerce. Their criteria are heavily dependent on credit scores and other factors that often have little to do with the way your business works.
Business Line of Credit
- Benefit: The right one can save you a fortune in interest and fees compared to most banks, loans, and credit cards.
- Drawbacks: Not all lines of credit have flexible repayment options. You’ll need to choose carefully to make sure you get the right one.
Cash Advance
- Benefit: You get paid the next day so you can keep your business expenses covered while waiting for your Amazon payout.
- Drawback: Many cash advance providers have strict daily repayment schedules and interest rates and fees in the triple digits.
What Are Some Scenarios Where a Daily Cash Advance Can Help Grow Your Business on Amazon?
According to a Federal Reserve Bank report, 40% of companies struggle to pay operating expenses. Like any business, eCommerce sellers must have a cash flow contingency plan in place to make sure they can keep their operations running while waiting for Amazon payouts.
Here are some common scenarios where a cash advance can help:
Maintain Marketplace Momentum
It takes work to rank high in search results on Amazon. You need to deliver consistently excellent customer support, retention, conversions and so much more. Whether it’s professional photos for your product listings, faster shipment options, or lightning-quick inventory replenishment, you can’t afford to let your ranking slip. By receiving a portion of your Amazon sales ahead of your next disbursement, you’re able to reinvest in your presence on the platform and make sure your future sales keep coming.
Smarter Inventory Purchasing
If you’re not prepared, peak seasons like Christmas, Black Friday, and back-to-school can be a nightmare for eCommerce owners. You’ll need more inventory on hand than normal just to keep pace with the increase in volume and stay ahead of any backorders and potential customer churn. With an advance on the revenue you’ve already secured through Amazon, you can purchase excess inventory when you need it and lock in exclusive discount rates.
Proactive Digital Advertising
If most of your cash is tied up in inventory or operational expenses, it can be hard to scale your marketing. With a daily cash advance, you can maintain your digital marketing and advertising efforts, including ad placements and email campaigns to help you boost cash flow during peak seasons and improve your annual ROI.
New Markets or Product Offerings
If you’ve had a particularly good month or quarter, now could be the time to expand your market foothold. With additional cash flow, you can launch new product lines or even expand into a whole new market without ever having to hit pause on your existing momentum. A cash advance can help cover the costs of a new fulfillment center, product description translations, and all the things you need to hit the ground running.
Staying on Top of Supplier Payments
Being chronically behind on your vendor payments can put you in a poor negotiating position in the future. If you want favorable supplier terms over the long term, you’re going to need to stay current with vendor invoices. With access to daily cash advances, you’ll have the cash flow you need to keep your suppliers paid and happy.
Boosting Team Capacity
As sales grow, so do operations. Any delay in your order fulfillment can contribute to a loss of sales and customer demand. Whether it’s to invest in new delivery options or to simply hire more staff, having access to your Amazon sales revenue today helps you make sure your sales and operations stay healthy tomorrow.
Crisis Management
Even though eCommerce sales experienced a 40% growth during 2020, it was far from an easy year. Backorders, customer complaints, and lack of employees were at an all-time high, causing very real issues for sellers. During this time, a strong cash flow position was what separated the eCommerce winners from the rest.
Uninterrupted Business Momentum
From rising stars on Amazon to season-based sellers, a strong cash flow position can be the financial cushion you need to keep your business running, such as ads for off-season discounts, website updates, unstoppable customer experience, or critical seasonal staff.
SellersFi Amazon Revenue Advance or Daily Advance: Stop Waiting for Your Amazon Seller Payout
At SellersFi, we’re allergic to rigid, outdated, and straight-up shady funding solutions. Our Daily Advance is fair, flexible, and tailored to the needs of Amazon sellers because it was designed by people with actual experience selling on Amazon.
When you apply for the SellersFi Daily Advance, you automatically slash your wait time for Amazon payouts from the typical two weeks to the very next day.
We’ll provide up to 90% of your previous day’s sales with rates as low as 0.5%. Zero prepayment penalty. Zero impact on your credit score.
There has been unprecedented growth in recent eCommerce history, with a 44% increase in Q3 2020 for US sellers alone. During that same period, SellersFi clients have seen an 85% increase in sales compared to the previous year. Because when our customers win, we win.
Ready to stop waiting on Amazon and start investing in your business? Register an account with us today with zero strings attached.
