There’s a change happening with the Amazon Disbursement Policy which will impact all sellers – Amazon are updating account reserve settings to what they call their standard reserve period of seven days after delivery – also know as DD+7, which they say is the setting that most Amazon sellers use worldwide.
Amazon suggest that this is to create a better buffer between the customer’s money and the seller, to ensure that customer are happy and are able to get the product and refunds as soon as possible.
If this news is a surprise to you and looks like nothing has changed, it’s probably because you’re already on DD+7. If you have an older account, it’s likely Amazon communicated this change would be coming months ago, and now it’s time for implementation.
DD+7 Reserve period
- The seven day reserve period starts after either the confirmed delivery date for tracked shipments, or
- After the estimated delivery date for untracked shipments
When an order is shipped Amazon will collect and hold payment until this seven day period passes and the move the funds to your available balance.
DD+7 is more than likely a greater than a 7 day period, because it also encompasses any days needed to prepare and pack the order, plus the one or two days it takes for the carrier to deliver the order. It’s going to be at least 8 or 9 days in most cases.
What’s also interesting, is that Amazon are also applying DD+7 to orders for goods held in FBA. This means that however long Amazon take to ship the order this carriage time they are still adding this time to the delay before you will receive payment, even if they, through Amazon Logistics, are in full control and responsible for delivering on time and any loss or damage in transit.
Impact on SMEs of DD+7
What this will mean for many SMEs is what Amazon describe as a “one-off cash flow impact”, but the reality is that this is a cash flow impact that will last for as long as you trade on Amazon.
One retailer wrote to us based on their 2025 trading figures, the change will require them to permanently finance an additional £20,000–£50,000 of working capital to operate their Amazon business. As with many businesses, their sales fluctuate throughout the year and in March when the policy comes into effect they’ll see around £20,000 held under DD+7, but by December in peak trading period this will balloon to around £50,000.
The result of constrained cash flow won’t just impact individual SMEs. They’ll have less available cash to invest in products from suppliers with a knock on impact across the country. They’ll also have less available cash to invest in employing additional workers resulting in higher than otherwise unemployment numbers.
In the grand scheme of things, DD+7 impacts in terms of a single SME business is negligible, although a huge impact for cash flow. Taken nationwide with 100s of 1000s of SMEs trading on Amazon, the numbers add up fast, especially when you take into account the downward impacts on suppliers and employment.
Add up all the numbers, and it means potentially there will be hundreds of millions held for an additional 7-9ish days by Amazon that would previously already have been disbursed. However, for those accounts about to move to DD+7, it’s simply bringing you into line with everyone else selling on Amazon.
4 Responses
Yet amazon still say (as you mention in the article) that this is “one-off cash flow impact”
surprised they didnt title it as “Good News”
Amazon fail to address the extremely low % of refunds issued by 99.99% of sellers and why they need to hold onto 100% of the proceeds for DD+7
Even the credit card merchant service providers who used to pay 3 business days after a transaction now settle next day and their merchant charges are only 1 or 2% – yet Amazon who are often on 15% for most categories want to settle on DD+7.
Are these delayed funds protected and held in a “escrow” or client account?
What would happen if Amazon went bust?
(ok they wont – but it is a valid question)
Are sellers protected in any way or would they need to join the queue of creditors?
The more interesting question is how much of sellers’ money is being held by Amazon in this ‘reserve fund’, and how much interest they earn on it!
I guess once it kicks in we could be talking about 300 – 400 million based on previously stated turnover and the % attributed to 3rd party sellers.
OK not allowed for peak etc and just gone for an average
they must be able to earn 5% on deposit – or perhaps offset their own borrowing costs
can these funds be legally held in their normal accounts without needing to be in “client accounts”