How to avoid Amazon’s long-term storage fees during the off-season when inventory is overstocked?

Have you noticed the notification about long-term storage fees in the Amazon’s backstage recently？The new policy has come, the FBA will check the inventory on the 15th of each month. Amazon will charge long-term storage fees for inventory that has been stored in the Amazon operations center in the United States for more than 365 days at a price of US$6.9 per cubic foot at that time. Moreover, these months are also the off-season of the platform sales when the sales volume has been affected, so what do we need to do about the overstocked inventory in Amazon? Or how to avoid long term storage fees?

How to determine the inventory to be paid for?

We can check which ASIN needs to pay long-term storage fee in the “Inventory Age” in the seller central, and you also can see storage time of each of your inventories in a very detailed manner: which are for 0-90 days; 91-180 days; 181-270 days … Access the buyer’s backstage inventory planning.

Amazon’s inventory is first in, first out!

We all know that the long-term storage fee is an extra charge from Amazon’s warehouse for monthly storage costs, which is charged when the inventory exceeds 365 days. So some friends may worry that, if I had 100 pieces of inventory a year ago, and then replenished 50 pieces after selling them for six months. When a customer place an order, will Amazon send out the inventory from the second batch 50 pieces when the first batch of 100 pieces has not been sold out, resulting in the first batch of items need to pay long-term storage fees! This concern is superfluous. Even if the operations center staff picks up and distributes the items that have recently arrived at the operations center, Amazon Logistics will still deduct the items from the earliest available inventory.

How to avoid the long term storage fee?

Remove inventory: Amazon charges $0.50 for each removal. The usual routine operation is to remove the inventory to the overseas warehouse, change the label of the item, re-prepare the listing and restock through FBA.

Select the item to be removed in the inventory interface, click Create removal order.

Here is usually filled in overseas warehouse or the address you want to remove.

Inventory disposal: inventory disposal is often referred to as destruction. Amazon charges $0.15 per item for destruction, and no long-term storage fees are required for the completely destructed products. However, before the disposal, you should consider whether to completely abandon your product or change the label and continue to sell. After all, the destruction of the items means nothing left, which is a complete loss.

Clear inventory: Maybe many people think that there will be no long-term inventory if there is a reasonable stock. I don’t want to talk about this, because the overstock has become a fact. Let’s talk about the plan that can be implemented immediately.

We need to have the logic of clearing items. Before clearance, we need to analyze the reasons for the overstock of the items. Is it the problem of our operation or the product itself has no market? If it is the former, we should decisively clean up the backlog of inventory, and dispose those that cannot be cleared, otherwise, if the backlog of the inventory is due to the lack of traffic caused by the poor operation level, then we should increase the traffic. It doesn’t matter if we spend some money, or even lose some money. What we need is to convert the overstocked inventory into cash, losing less is win, this is my logic for clearance.

①Off-site promotion: release to the off-site promotion platform after setting the discount coupon, make full use of the traffic from these platforms to generate purchases, remember setting a larger discount to smoothly clean up the inventory. If your inventory is huge, I It is recommended to access several off-site promotion websites at the same time, so that the clearance speed will be much faster.

②On-site LD and advertising: slow-moving items are generally caused by lack of traffic, it is estimated that there is no major problems in selecting products, there will be a certain market, so, In-station lightning deals and advertising can also magnify traffic, but before these operations, we still Need to ensure that the listing details page quality is OK, and there are certain reviews, so that there will be better results.

③Find people in Facebook group to clean up the inventory.