Manage Your Sourcing Cost for a Large Catalog: What Amazon Accepts, Why It Declines, and the Gap to Landed Cost

By Bernardo Campelo, Forbes Business Council E-Commerce Leader, Amazon SPN Certified provider, Amazon SP-API authorized partner, and Founder of PrepVia.

As of October 29, 2026, Amazon's FBA inventory reimbursement policy says that for shipment to Amazon, fulfillment center operations and removals claims that occur before fulfillment, "we will reimburse you the sourcing cost of the item." Sourcing cost is what you paid a manufacturer, wholesaler or reseller, or what it cost to produce the item if you are the manufacturer. Amazon writes that it "excludes costs such as shipping, handling, customs duties, or other costs."

For a brand with a few dozen SKUs, that is a line item. For a catalog of several hundred FNSKUs, it is a file: one approved number per FNSKU, a document behind each number, and a review process that can decline a cost even when the invoice is real. Amazon's Manage Your Sourcing Cost help page is public and lays out the documents Amazon accepts, the reasons it denies a submission, a bulk update tool for large catalogs and a re-evaluation flow for reimbursements already paid.

Every date and name below was checked on October 29, 2026 against Amazon's Seller Central help pages (the FBA inventory reimbursement policy, Manage Your Sourcing Cost, Changes to program policies and the Inventory Defect and Reimbursement portal), Amazon's Seller Forums announcements and the Selling Partner API documentation, linked where they first appear. Amazon edits these pages without notice, so check the live page before you act.

What Amazon Pays, and When the Rule Applies

The sourcing cost rule covers losses before a customer order. The policy names three claim types: shipment to Amazon claims, fulfillment center operations claims and removals claims. It also covers "lost and damage claims during inventory replenishment handled by Amazon or on behalf of Amazon." Customer return claims run on a different basis: "the value of the reimbursement is based on the refund or replacement given to the customer on your FBA order."

So "Amazon reimburses at cost, not at the sale price" is only half right: after a customer order, the refund amount drives the number. A finance team that books every reimbursement against inventory cost will misread that group.

Three more lines from the policy shape the math:

• The cap. "The maximum reimbursement amount for a single unit of any FBA eligible item is $5,000." Above that, Amazon recommends third-party insurance.
• The default. "If you don't provide your sourcing cost, we'll use our own cost estimate for reimbursement calculations." The estimate comes from "comparable products sold by Amazon, by other sellers, and through other wholesale channels."
• Unsellable units. Items that were unsellable when lost or damaged are reimbursed "at a reduced estimated cost of the unit."

Amazon also says that "your specific cost data is not shared with any other seller in Amazon's store, including Amazon Retail." Whether that statement is enough for a brand wary of sharing its factory price is a decision for your own team.

Amazon announced the change on December 18, 2024, first as "manufacturing cost" with a March 10, 2025 start, then moved the effective date to March 31, 2025, as the Changes to program policies page still records.

What the Manage Your Sourcing Cost Page Shows

The page sits inside the Inventory Defect and Reimbursement portal. Amazon's help page says you reach it from the Inventory Defect and Reimbursement page by clicking Manage Your Sourcing Cost. Seller Central is moving its navigation to a new layout, so look for the page by name rather than memorizing the clicks.

Not every FNSKU is listed. The page "displays active listings (FNSKUs) with planned shipments or current inventory in our fulfillment network." Amazon adds that "older FNSKUs may not appear on the page if they were shipped prior to 2024 and haven't had a reimbursement since then," and that a new reimbursement on an older FNSKU makes it appear. If an FNSKU is missing, the help page says to check that the right store is selected and to look again later.

Each row carries a source indicator, a status and a value. These are the three things to read:

What Amazon Accepts as Proof of Value

The help page is specific. Amazon accepts five document types: manufacturer invoices, wholesaler invoices, purchase invoices, commercial invoices, and Chinese Fapiao (tax invoices) if they meet the required attributes.

The list of rejected documents matters just as much: "We do not accept proforma invoices, packing slips, quotes or estimates from suppliers, purchase orders, website listings or catalogs, screenshots from online shopping carts, and other documents that do not directly confirm sale."

The document also has to carry eight attributes: document name, number and date; the buyer entity, meaning "your business name registered with Amazon," with address and tax identification; the issuer entity, with address and tax identification; product details such as SKU, ASIN, item number or model number, with description and quantity; a "clear indication of the sourcing cost or purchase price"; and the currency of the transaction.

Format rules are tight as well. Files must be .jpg, .jpeg, .png or .pdf, "with a maximum file size of 25MB." Spreadsheets and Word files are not accepted. Among the common decline reasons, Amazon lists "Document age: Proof-of-value document is older than five years from the date of submission."

The submitted number has to match the paper. Amazon denies a value that differs from the unit cost on the document because of entry errors, currency conversion or discounts. Its instruction on currency is to "apply the exchange rate from your submission date to convert the value correctly." Discounts shown on the invoice have to be reflected in the value. For bundles, a document is needed for every component.

One point causes confusion. A shipment to Amazon claim asks for proof of ownership, and there Amazon lists "a signed packing slip if you are a manufacturer" as an acceptable example. For sourcing cost, packing slips are on the rejected list. The two pages answer different questions: one asks whether the units were yours, the other asks what they cost. Keep the two document sets apart.

Why Amazon Declines a Cost

The policy gives four reasons Amazon may decline a sourcing cost submission:

• Outlier. "Your submission is an outlier compared to similar products or our cost estimate."
• Document integrity. "Any documentation is forged, tampered with, or illegible."
• Account. "Your account is suspected of fraud, significant policy violations, or non-compliant selling activities."
• Repeat. A decision on the same item already received "within the last 30 days" with no new information supplied.

The outlier rule carries the most weight. The help page says, in its note on re-evaluation requests, that an outlier value "may receive a decline decision without document review, even if your documentation meets all requirements." A clean invoice does not protect a number that sits far from Amazon's view of comparable products. If your cost is well above Amazon's estimate for a good reason, keep the reason documented with the invoice.

The cost of a decline is set out plainly: "If we decline your submitted sourcing cost, we will reimburse you based on a previously approved amount that you submitted or our estimate of your sourcing cost for the item." A decline sends the FNSKU back to whatever was there before: a previously approved cost, Amazon's estimate, or "-" if Amazon has no estimate yet.

Frequency is limited, and Amazon's own wording is not consistent. The help page says Amazon will "allow you to submit two cost updates once every 30 days," but its explanation of the "Exceeded number of attempts" denial applies once you have "received a decision" on the same item within the last 30 days, and the policy adds "and have not supplied any new information." Re-evaluation claims count as attempts too. Plan on one decision per FNSKU in any 30-day window, and send a second only with new information, such as a new invoice.

Approved costs can change later. The policy says Amazon will "periodically refresh our cost estimates," and that if a refresh affects a cost you provided, "we'll notify you and give you time to review." The Scheduled update status shows the new value and the date it applies.

The manufacturer without a purchase invoice

The definition includes the manufacturer: sourcing cost covers what it costs to "produce the item if you are the manufacturer." The documentation rules are written around a sale between two parties.

The denial table on the help page is direct. A proof-of-value document is denied when it "has missing buyer/supplier names," "lists same for both buyer and supplier," or "shows buyer information that does not match your registered Amazon Seller Account." A company that makes its products and sells them on Amazon under the same legal entity has no third-party invoice for its own goods, and an invoice it issues to itself meets the second condition.

Amazon's help pages do not publish a separate route for this case. What the pages do say is what happens next: without an approved seller cost, the FNSKU stays on Amazon's estimate, or on "-" if Amazon has none. For a manufacturer, the practical work is:

• Read the estimate. Download the template and compare Amazon's estimated cost per FNSKU with your own cost records. Some estimates may be close enough to leave alone.
• Find the third-party invoices you do have. Finished goods bought from an outside supplier carry invoices that can meet the attributes. An invoice for raw materials or parts is a different case: it will not identify the FNSKU or show its unit cost, and Amazon denies a document when the FNSKU "cannot be identified or verified" on it. The component rule applies to bundles, where Amazon asks for a document for every product in the bundle.
• Keep the internal cost build. Amazon will not take it as proof of value, but your auditors will ask for it.
• Ask a professional about structure. How your entities buy and sell between themselves is a question for your accountant or attorney.

Loading Costs for Hundreds of FNSKUs

One-by-one entry in the side panel works for a short list. For a large catalog, Amazon provides a Bulk update tool on the Manage Your Sourcing Cost page. The steps on the help page are:

• Download. Click Bulk update, then Download sourcing cost, to get "a pre-populated template with your listed ASINs or FNSKUs."
• Fill one column. Enter new values in the Seller Cost - New column only. Values must be "positive values greater than zero with up to two decimal places maximum," typed as values, with no formula references such as VLOOKUP. Leave the cell blank for FNSKUs you are not changing.
• Upload. One file at a time. The system validates format and content, and errors must be fixed before you proceed.
• Submit. Select Submit for Review, then track each FNSKU in the status column.

The template has value beyond the upload. Amazon says it "includes columns for ASIN, FNSKU, Amazon estimated cost, latest approved cost, source of latest approved cost, currency, date of latest approved cost." Downloaded each month, it is Amazon's view of your cost by FNSKU, with dates, to compare against the ERP. That comparison is our suggestion, not an Amazon requirement.

There is one limit to plan around: "The bulk cost update tool currently doesn't support document uploads in bulk." If Amazon asks for proof after a bulk submission, each document goes in FNSKU by FNSKU on the page. Amazon does not publish a row limit for the bulk file. A practical order: the "-" rows first, then high-value and high-loss FNSKUs (the Inventory Defect and Reimbursement portal filters defects by SKU, ASIN or FNSKU), then rows where the estimate sits far below your invoice, with the invoice ready for a document request.

On cost by lot: the page holds one latest approved sourcing cost per FNSKU, not a cost per purchase lot. The submitted value also has to match the unit cost on the document. Our reading is that a blended average across several invoices will not match any one of them and invites a mismatch denial. When a new invoice carries a new factory price, that invoice and its unit cost are what you submit, once per 30-day window.

"Amazon pays your sourcing cost, not your landed cost. Freight, handling and duties stay on your books. Keep one approved number per FNSKU, backed by an invoice that names your business as the buyer, and resubmit when a new invoice changes the price."

Bernardo Campelo, Founder of PrepVia

The Gap Between Sourcing Cost and Landed Cost

Even with every FNSKU approved, the reimbursement will be lower than the inventory value on your books if you carry inventory at landed cost. Amazon's definition leaves out "shipping, handling, customs duties, or other costs." Those are the lines that turn a factory price into a landed cost.

Say a brand imports a product at an invoice cost of $8.00 a unit. Ocean freight and drayage add $0.90, customs duties add $1.60, and freight from the warehouse to the fulfillment center adds $0.45. The landed cost is $10.95. If Amazon loses 400 of those units in a fulfillment center and the approved sourcing cost is $8.00, the reimbursement is $3,200 against $4,380 of book value. The $1,180 difference never comes back from Amazon. All of these numbers are illustrative.

Our reading of the policy is that tariffs paid at import fall under customs duties, which Amazon excludes. Amazon does not name tariffs on the page. When duty rates rise, the share of landed cost that the reimbursement does not cover rises with them. The import side of that math is in our post on the three tariff regimes of 2026, and the full build of a landed cost is in landed cost per unit, from container to Amazon check-in.

For the close, plan for this gap rather than explain it afterward; how to book it is a question for your accountant. Our three-way reconciliation guide shows where this cost layer breaks the tie between the 3PL count, the Amazon ledger and the ERP.

Contesting a Reimbursement Already Paid

If a reimbursement was calculated on the wrong sourcing cost, the help page describes a re-evaluation flow. Go to Get help and resources or use Seller Assistant, and select Submit a reimbursement claim dispute. Enter the original Reimbursement ID, upload a proof-of-value document if required, pick the FNSKU and enter its unit value.

• One FNSKU per request. "You can only select one FNSKU at a time."
• Full unit value, not the shortfall. "Do not enter the total difference amount you believe you were under-reimbursed."
• It counts as an attempt. "All re-evaluation claims count as an attempt to update the sourcing cost for the FNSKU."
• Match the approved value. If an approved cost exists within the last 30 days, the requested value must match it exactly.
• Timing. For approved claims, "Reimbursement is processed within 4-5 business days," and the cost is updated for future reimbursements.

On deadlines, read the policy closely. It says that if you disagree with Amazon's valuation of a unit, you can file "within 60 days after we have issued the reimbursement." That sentence sits in the customer return section of the policy. The Manage Your Sourcing Cost page does not state a separate window for re-evaluating pre-order losses. For fulfillment center losses, Amazon's fulfillment center operations claim page says claims are due "no later than 60 days after the date the item was reported as lost or damaged," and the same page covers disagreeing with a resolution on the Resolved tab. Treat 60 days as a working limit and count it from the earlier of the two dates, the loss report or the reimbursement. Whether either window applies to a sourcing cost re-evaluation is not stated, so file early and do not cite either one as Amazon's rule for these disputes.

For the monthly check, the Selling Partner API's FBA Reimbursements Report (GET_FBA_REIMBURSEMENTS_DATA) lists each reimbursement with reimbursement-id, case-id, reason, sku, fnsku, asin, amount-per-unit, amount-total and the cash and inventory quantities, and its content is "updated daily." Comparing amount-per-unit with the latest approved cost in the Manage Your Sourcing Cost template finds the reimbursements worth disputing. The report also carries a reimbursement-id on every line, which makes it the natural starting list for disputes.

Where a Prep Center Fits

The cost file belongs to the seller. The invoices come from your suppliers, the values are submitted from your Seller Central account, and the disputes are filed there. A prep center does not hold your factory price and cannot make Amazon accept it.

What a prep center holds is the count: how many units arrived, in what condition, against which packing list. Amazon does not list that record as proof of value or of ownership. It answers a different question, whether a loss happened before the units left the dock or after Amazon took them, and that decides which claim exists at all.

At PrepVia, discrepancies are reported within 24 hours of arrival, with photos. The PrepVia app shows real-time tracking of expected versus received units, so the count your finance team reconciles against starts at our dock. PrepVia is at 8507 NW 72nd St, Miami, FL 33166, receives imported freight and routes it into Amazon FBA, and ships on Amazon partnered LTL and FTL.

Ask any 3PL whether it counts every inbound against the packing list and how fast, and with what evidence, it reports a shortage.

Frequently Asked Questions

What does Amazon pay for a lost FBA unit in 2026?

For shipment to Amazon, fulfillment center operations and removals claims before fulfillment, Amazon reimburses the sourcing cost: your approved cost on Manage Your Sourcing Cost, or Amazon's estimate if you have none. Units that were already unsellable are reimbursed at a reduced estimated cost. The cap is $5,000 per unit. Customer return claims are based on the refund or replacement given to the customer.

Does sourcing cost include freight and duties?

No. Amazon's definition excludes shipping, handling, customs duties and other costs. If you carry inventory at landed cost, the reimbursement will sit below book value even when your sourcing cost is approved.

What documents does Amazon accept for Manage Your Sourcing Cost?

Manufacturer, wholesaler, purchase and commercial invoices, and Chinese Fapiao that meet the attributes. Not proforma invoices, packing slips, quotes, purchase orders, listings or cart screenshots. The buyer on the document must be your business as registered with Amazon.

How do I update sourcing cost for hundreds of SKUs?

Use Bulk update on the Manage Your Sourcing Cost page. Download the pre-populated template, fill the Seller Cost - New column with values (no formulas), upload one file and select Submit for Review. Documents cannot be uploaded in bulk: if Amazon requests proof, you submit it FNSKU by FNSKU.

Why was my sourcing cost denied?

The status column shows the reason, such as a value outside policy guidelines (for example, an outlier), a document problem, the account, or a repeat within 30 days (Amazon's pages say two cost updates in one place and one decision in another, so plan on one). A declined cost falls back to your last approved value or Amazon's estimate.

I am the manufacturer. Can I invoice myself?

Amazon's help page denies a proof-of-value document that lists the same entity as buyer and supplier, or whose buyer does not match your registered Amazon account. Amazon does not publish a separate route for manufacturers, so the FNSKU stays on Amazon's estimate unless you have a qualifying third-party invoice. Questions about entity structure belong with your accountant or attorney.

Final Take

Since March 31, 2025, the number in Manage Your Sourcing Cost is the number Amazon pays on pre-order losses of sellable units, up to $5,000 a unit. For a large catalog, that number needs the same discipline as any other balance a controller signs off: one approved value per FNSKU, an invoice behind it that names your business as the buyer, a monthly comparison against the reimbursements report, and a record of the landed costs Amazon will never cover.

Fill the "-" rows first, use the bulk template for the rest, and remember that a second update on the same FNSKU within 30 days can be denied.