Please read: this guide is general information, not legal or customs advice, and rates and examples are illustrative. Drawback claims must be completed within 5 years of the date of importation (19 U.S.C. 1313(r)). Destruction claims require destruction under CBP supervision with advance notice, and DrawbackIQ currently prepares unused-merchandise export claims only. Your licensed customs broker decides what can be filed.
Housewares have particularly high return rates, and returned items that are destroyed rather than resold are eligible for duty drawback. For housewares retailers and Amazon FBA sellers, destroyed returns often represent the largest refund opportunity, potentially exceeding export refunds on a dollar basis.
Returned housewares are frequently destroyed due to: (1) hygiene concerns (items that contact food or water); (2) damage from the return shipping process; (3) incomplete sets or missing components; (4) seasonal inventory that cannot be re-sold; (5) end-of-season clearance that must be cleared quickly. Return rates for housewares on Amazon can exceed 25 percent, creating significant destruction volumes.
The statute refunds 99 percent of eligible duties on destroyed merchandise. For housewares with 4 percent base duty rates, even a 5 to 10 percent destruction rate over five years creates a refund opportunity in the $40,000 to $100,000 range for mid-sized importers.
A housewares retailer imports $2.5 million annually at an average 4 percent duty rate. Twelve percent of inventory is destroyed annually (returns, damage, clearance). Over 5 years, the estimated refund on destroyed housewares is approximately $59,400. This is cash on inventory already written off.
Your broker will need: (1) CBP import entries; (2) destruction records (Amazon FBA waste reports, facility destruction logs, waste processor invoices); (3) quantities matched to import entries by SKU or invoice; (4) proof of destruction. Amazon FBA sellers can request destruction reports from their fulfillment center accounts.
Some housewares products (especially lightweight items and storage solutions) have return rates exceeding 30 percent. If your product mix includes high-return items, destroyed merchandise refunds are especially valuable. Request Amazon waste data for your best-selling items; you may find the destroyed volume is substantial.
Estimate your destroyed housewares refund.
Free EstimatorDrawbackIQ prepares claim packages for a licensed customs broker to file. DrawbackIQ is not a customs broker. This page is informational only.