The Amazon FBA program is a service that provides sellers with a convenient way to fulfill orders on the Amazon marketplace.
With fulfillment by Amazon, sellers only have to ship their products to an Amazon fulfillment center while Amazon takes care of everything from storing and handling your Amazon products to picking and shipping them to customers.
However, amidst these benefits, the FBA program also has its limitations. One of them is the Amazon FBA inventory limit.
As an Amazon FBA seller, understanding your Amazon FBA inventory limit is critical to proper inventory management and your overall success.
In this article, we look at all you need to know about an Amazon FBA inventory limit and how it can affect your business.
An Amazon FBA inventory limit is a storage limit placed by Amazon on sellers. It specifies the maximum number of Amazon inventory you can store at Amazon fulfillment centers. This inventory limit varies from seller to seller.
You may be thinking, why does Amazon have an inventory limit? Well, while Amazon has many fulfillment centers all over the world, Amazon does not want to have more products in their storage picking up dust.
If you have a high sell-through rate, you will likely be able to send more products to fulfillment centers. On the other hand, if you overstock or have a slow-selling inventory, your Inventory Performance Index (IPI) will take a dip, decreasing your FBA inventory limits.
To check your Amazon FBA inventory limits, simply go to your Seller Central Dashboard, and on the Inventory menu, click on Manage Inventory > Manage FBA shipments.
At the end of the page, you will see “Storage Volume” and “Restock Limits”. Go to “Restock Limits” to see how much storage space is available for different storage types. You will also find the following quantities:
In February 2022, Amazon placed restock limits for different storage types. This includes standard-size storage, oversize storage, and so on. This means that sellers were no longer limited to ASIN-level restock limits which were introduced in 2020 due to the pandemic.
With the storage based restock limits, sellers can create shipment plans without worrying about ASIN restrictions.
However, this type of inventory limit also has its limitations. For example, it may be difficult to add new products or more products to a particular storage type. Also, if your available inventory and inventory in transit go over your restock limit, you won't be able to create a shipment on your Amazon seller account.
If you try to ship inventory above your restock limit, you will be violating Amazon's Terms of Service. The only way to get around your Amazon FBA inventory limit is to store your inventory at a third-party fulfillment center or your own storage space. Any shipment plan created will be canceled.
Amazon revises inventory limits based on how well a seller performs. So here's how you can increase your Amazon FBA inventory limit:
Amazon calculates your restock limits using your sales history. If you can generate more sales, you may get a little increase in your maximum inventory limit. Several strategies can help you increase sales for slow-selling inventory. You can invest in PPC campaigns to increase visibility and ultimately boost sales. Additionally, you can drive external traffic to your product listing using email marketing and social media.
Your IPI score or Inventory Performance Index is a metric that reflects your inventory performance over a period. It shows how effectively you are managing your Amazon inventory.
Improving your IPI score may earn you a little boost in your FBA restock limits.
Here are a few ways you can improve your IPI score:
If your IPI score is above 450, it is considered good on Amazon. If maintained for a few weeks, you get unlimited storage space for each storage type. However, restock limits will still apply.
If your inventory is stored in Amazon fulfillment centers over a full year, Amazon charges long-term storage fees. You want to avoid these fees by generating sales for slow-selling inventory.
Inventory management can become challenging especially if you are selling multiple products. As an Amazon seller, you want to ensure you have enough products in stock and also avoid overstocking products.
To accurately predict this, you can invest in inventory management tools. This will automate the process and help you maintain a good IPI score.
Restock limits for individual sellers are different from professional sellers.
Professional sellers get a higher restock limit which could also change over time. On the other hand, individual sellers have a fixed restock limit of 500 units for standard-size storage products and 100 units of oversize storage products.
Amazon makes IPI score calculations every three months. However, there are no scheduled dates when Amazon revises restock limits. Following best practices to increase your restock limits improves your chances of getting a good review.
Handling Amazon FBA inventory limits can be quite challenging. However, with proper planning, you can navigate the restock limits and manage your inventory properly.
If you have further questions on how to handle Amazon FBA inventory limits effectively, you can speak to one of our Amazon FBA consultants on ePlaybooks right away.