Low Inventory Fees

Fulfillment by Amazon
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Just need to vent about the calculation of the low inventory fees.

One of our products had a spike for a couple of weeks but it has since subsided. We were sending in a ton of inventory but have stopped to make sure they go through all the inventory they have and to avoid long-term storage fees.

On the FBA inventory page it’s telling me my level is healthy and I have double the amount of the recommended inventory on hand. But it’s also telling me I only have 11.6 days of supply and will be charged a low inventory fee of $0.97 a unit and need to send in 60 more units.

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Meanwhile, over on the Restock Inventory page, it’s telling me I have 72 days of supply and should send in 0 more units.

I have this conflicting information where the inventory level is healthy but I’m being charged the low inventory fees on 10 skus.

I’d really like to avoid these ridiculous fees but I just can’t seem to escape them, it’s a lose-lose situation of low inventory fees and long term storage fees.

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I don’t do FBA, but I would submit this as a case to SS. It’s a big problem and needs documentation, IMO.

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Thank you for the post, IMO (In My Opinion) it is not a vent it is useful information for other sellers asking sellers questions on this issue.

I was going to post something on this but have been very busy with a renovation project and trying to survive the state of the economy we are in.

Low Inventory Fees

Great title! Agree with you on the issue and premise, especially the impact of this new tax by Amazon.

We stepped back as the noise we all made caused them to shift direction in implementation of this tax. What I am saying is they silenced calmed us since they put in a waver (exempted) low volume items.

I planned to share this thread here on the SAS, since it did resolve our problem. Selfish of me to not share for 2 months but we have been that busy.

For us our competitive advantage is that we sell a large amount of products with different themes, colors, sizes, etc… When they announced “Exempting listings that sell less than 20 units in 7 days” I felt it was a very reasonable solution.

The response from @jim_amazon;

This is a fact! Because of the greater unpredictability in managing inventory levels for seasonal, end-of-life, and other low-volume products with varying demand, starting May 15, the low-inventory-level fee will not apply to products that have sold less than 20 units in the past 7 days.

My business partner onboarded us to the NSFE in error, and sadly no turning back. This post on the NSFE was the day we changed our NSFE moniker to add SAS to it. Another story…

Now we have a product that is trending on one of our brands. Happens from time to time and I know we will be over the exemption limit soon. Frankly, we are getting spanked enough for not sending units to FBA. For those that do not know we offer both FBA and FBus (FBM) at the same time. “Spanked enough” as in we are loosing sales and we know it for not keeping items in stock. It is a material cost issue, and manufacturing capacity issue for the most part. Not a bad problem to have.

Sadly the solution should we get hit with a $1 tax, or whatever it will be… We will “delight the customer” by raising the price to cover it. Something I do not want to do.

Amazon is motivating us to react to this “tax” be careful what you wish for Amazon.

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There’s a reason why that NSFE post has had but a single upvote since I cast it.

I’m still not pleased that you and I appear to be the only ones who recognize the value of Jim’s insight into the inner workings…

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I also do both FBA and “FBus”. I’m choosing not to send more stock in of an item that I normally do because I know the inventory amount I have on hand will not be enough to avoid the low inventory fees (I have more coming that’s about a month out).
I’ll fulfill the orders myself instead of paying their extra tax.

I hope they are seeing a cumulative drop in FBA participation in response to the too low / too high tax tightrope. Sales volume is not always predictable for all products. Unforeseeable spikes and slumps happen in the real world.

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