DA

Damage Allowance is a pre-negotiated percentage that Amazon deducts from payments to account for potential product damage. Instead of processing returns or claims for every damaged unit, Amazon assumes a certain level of loss and offsets it through this allowance.

This arrangement benefits both parties by:

• Reducing the administrative burden of managing minor damages
• Simplifying the reimbursement process
• Allowing Amazon to keep slightly damaged but sellable inventory in circulation (e.g., for Amazon Warehouse Deals)

📌 Key points:

• Common in 1P Vendor Central relationships
• Typically part of Annual Vendor Negotiation (AVN)
• Often ranges from 1% to 3% of cost price, depending on category and product type

💡 Example: If your DA is 2% and you invoice Amazon for $10,000 worth of goods, Amazon may pay $9,800, keeping $200 as expected damage coverage.

In short:
DA is a built-in discount Amazon receives to cover expected product damage - reducing the need for individual claims and streamlining operations.