Amazon FBA inventory management: IPI, limits and storage fees

Good inventory management on Amazon FBA comes down to one balance: hold enough stock so you never run out, and little enough that you are not paying to warehouse dead weight. Three levers decide which side of that balance you land on: your IPI (the health score of your inventory), your capacity limits (how much you are allowed to send in at all) and your storage fees (which climb month after month when stock just sits there). Sellers who watch these three on a steady rhythm do not get a bill they never saw coming at the end of the quarter, and they do not lose rank to an empty warehouse.

Below we break each lever into its parts, give the current rates for European marketplaces (as of the FBA Europe rate card in force from 1 July 2026) and finish with a concrete routine you can put in place from tomorrow. If you are just getting started and want to understand the model itself, begin with the piece on how Amazon FBA works, then come back here.

The three things that drive your FBA inventory costs

Before the detail, here is the map. Keep these three levels in mind, because we return to them in every section:

• IPI (Inventory Performance Index): a health score for your inventory on a scale from 0 to 1000. It affects how much you are allowed to store.
• Capacity (restock) limits: a hard ceiling on how much stock you can fit into Amazon's warehouses in a given month.
• Storage fees: a monthly charge for the space you occupy, plus penalty surcharges for stock that sits too long, or that you hold too much or too little of.

These three levels are linked. Low turnover raises your fees and lowers your IPI; a low IPI tightens your limits; and tight limits make it harder to restock your bestsellers. That is why inventory is not something you manage once a quarter, but on a weekly cycle.

The IPI score: what it is and what feeds it

IPI is a number from 0 to 1000 that Amazon assigns to your FBA account as a measure of how efficiently you manage inventory. The exact formula is closed (Amazon does not publish it, just as it does not publish the Buy Box algorithm), but four areas are known to feed the score:

• Sell-through rate: how many units you sold over the last 90 days relative to your average inventory on hand. High turnover means a high score.
• Excess inventory: the share of SKUs where you hold more than roughly 90 days of forecast sales. Excess drags the score down.
• Stranded inventory: units that physically sit in the warehouse but cannot be bought (for example the listing dropped, the ASIN is blocked, or there is a compliance issue). This is trapped capital and a penalty on your score.
• In-stock rate: how often your bestsellers were available over the last 30 days. Frequent stockouts lower the score.

The score refreshes regularly (in practice weekly, based on data from the last few months), so it responds to your moves with a lag rather than instantly. That matters: you will not see the effect of cleaning up your inventory the same day.

What IPI threshold is safe? Amazon keeps a minimum threshold below which an account is restricted. Historically this has been in the region of 400 points, but this number changes over time and varies by marketplace, so always confirm the current threshold for your account in the Inventory Performance section of Seller Central. The practical rule is simpler than any single figure: the higher your IPI, the more space and freedom you get, and dropping below the threshold shows up as blocked shipments.

Capacity limits: how they work

The inventory limit (Amazon now communicates it as a capacity limit) is the upper bound on the volume you can store in FBA warehouses. The key change of recent years: the limit is no longer counted in units or fixed once a quarter, but measured in volume (cubic metres in the EU, cubic feet in the UK) and set more often, usually on a monthly cycle.

The size of your limit depends mainly on your IPI, your sales history, demand forecasts and how much space is available in Amazon's network. A seller with high turnover and low excess gets more space, because Amazon knows the stock will move. A seller whose warehouse is full of slow-moving goods gets less, because they are taking up space needed by faster products.

The practical effect is that the limit rarely hurts evenly. It hurts when you want to ship in a bestseller ahead of a sales peak and the space is occupied by dead SKUs. That is why freeing up your limit from dead stock is not tidying for the sake of tidying, but reclaiming space for goods that actually earn. You can check the exact status and structure of your limit in the Capacity Monitor in Seller Central, and that is the only binding source for your account.

Storage fees: how much and when

This is where it gets concrete. Amazon charges a storage fee every month, based on the volume your stock occupies (the daily average across the month). The rate depends on category and size, and it rises sharply in the fourth quarter. Below are the rates for European marketplaces billed in euros (DE, FR, IT, ES, NL, PL, BE, IE), as of the rate card in force from 1 July 2026.

Look at the middle row: for a typical standard-size product the Q4 rate jumps from 27.54 EUR to 52.20 EUR per cubic metre, almost doubling. This is not a penalty, it is Amazon's invitation to hold only what you will genuinely sell within a few weeks during peak season. Every pallet of slow-moving stock costs almost twice as much in November as it does in May.

That is not the end of it. On top of the monthly fee sit three surcharges that are easy to miss:

• Aged Inventory Surcharge: applied to goods that sit in the FBA network for a long time. In the EU it starts in the 241–270 day band and rises in steps: 47.99 EUR per m³/month at the first tier, through 125.16 EUR (271–300 days), up to 261.97 EUR per m³ (or 0.25 EUR per unit, whichever is greater) for stock older than 455 days. Apparel, shoes, handbags, jewellery and watches are excluded. This is the most expensive trap in inventory management: stock that will not move ends up costing a multiple of normal storage.
• Low-Inventory-Level Fee (Low-Inventory Cost Coverage, Pan-EU): applies to standard-size products in the Pan-EU programme when your historical inventory (both the 90-day long-term and the 30-day short-term measure) falls below 28 days of sales. It is charged per unit, in bands based on how low stock has dropped (for a standard parcel roughly 0.67 EUR below 14 days, 0.35 EUR in the 14–21 day band, 0.21 EUR in the 21–28 day band). It does not apply in, among others, the Netherlands, Poland, Sweden, Belgium and Ireland. The logic is counterintuitive: Amazon charges you for shipping stock in small batches instead of keeping a healthy buffer.
• Storage Utilisation Surcharge: for professional sellers whose ratio of stored to shipped inventory exceeds 22 weeks, outside the apparel/eyewear/shoes/bags categories. It starts at 14.85 EUR per m³ in the 22–28 week band and grows as turnover worsens. It does not apply to new sellers (first shipment less than a year ago, low volume).

This is only part of the bill. The full picture, together with fulfilment fees and referral fees, is laid out in a separate piece on the structure of FBA fees. It is also worth remembering that since 17 April 2026 Amazon adds a 1.5% fuel and logistics surcharge to fulfilment fees (on marketplaces including PL, DE, FR, IT and ES).

Removing and liquidating dead stock

If goods will not move, holding them to the next aged-inventory tier is the most expensive decision you can make. Amazon gives you three exits, each charged per unit: return to seller (from 0.50 EUR for a light standard unit), disposal (from 0.74 EUR) and liquidation (from 0.42 EUR per unit plus a 15% fee on the recovered value). The maths is simple: if monthly storage plus the rising aged-inventory surcharge exceeds the cost of removal, the stock should leave the warehouse. It is arithmetic, not sentiment, and every square metre you free up comes back as capacity for products that earn.

Why an empty warehouse costs more than a full one

The most expensive mistake in inventory management is not excess, it is a stockout on a product that sells. When stock drops to zero, several things happen at once, and they all cost:

• You lose the Buy Box. An out-of-stock offer drops out of the Buy Box, and without the Buy Box real sales on that ASIN almost stop. The mechanics, and what beyond availability affects who wins it, are laid out in the piece on how the Buy Box works and how you lose it.
• You lose rank. Your position in Amazon's search results depends partly on sales history. A gap in availability slows your sales velocity, and rebuilding rank after you are back in stock takes longer than the stockout itself.
• You lower your IPI. A falling in-stock rate drags the score down, which in the next cycle can tighten your limit and make it harder to restock that very bestseller. The loop closes on itself.

That is why stock on your well-selling SKUs is not a cost but revenue protection. The trick is to hold that buffer on the right products rather than spread it across the whole catalogue. Money frozen in slow-moving stock is a profitability question, which we develop in the piece on margin and the cost of capital tied up in inventory.

An FBA inventory management routine (checklist)

Theory only works when it turns into a repeatable rhythm. Below is a routine that keeps IPI high, fees low and bestsellers in stock. It is a practical recommendation, not an Amazon requirement: adjust the frequency to the size of your catalogue.

Every week:

• Check your IPI and its four components. React to what is falling, not to the headline score.
• Review stranded inventory. Every SKU here is stock you pay for but cannot sell. Unblock it or remove it.
• Verify days-of-cover on your bestsellers. Anything approaching lead time plus production time, order now, not in two weeks.

Every month:

• Flag dead stock (over roughly 90 days of cover with no turnover). Decide: price cut, promotion, return or disposal, before it hits the aged-inventory surcharge.
• Count which SKUs are approaching the 241-day threshold. This is the last moment to decide on removal.
• Compare your capacity limit with your delivery plan for the coming weeks. If the limit is tight, free up space from dead stock first.

Before Q4 (August–September):

• Forecast peak demand and stagger deliveries so you enter November with a buffer on bestsellers, but without lingering stock that will pay the doubled storage rate.
• Plan your exit from seasonal stock in advance, so it does not get stuck in the warehouse into January and the next age tiers.

Rule of thumb: forecast demand, restock in time, cut dead stock and never let bestsellers hit zero. Four moves, repeated on a rhythm, handle most of the problem.

Where Amazonway helps

This routine looks simple on paper, but in practice it disappears under day-to-day firefighting, especially with a wide catalogue and sales across several marketplaces at once. At Amazonway we run this kind of inventory management as part of ongoing account management (the Momentum stage of the Waypoint framework): we monitor IPI and limits, watch the fee thresholds, plan deliveries around the season and decide on removing dead stock before it turns into an aged-inventory charge. We work on a retainer-plus-success-fee model, so we want your capital working in products that turn over, not sitting in an Amazon warehouse. We do not promise specific rankings or results, because those depend on too many variables; we promise an orderly process and decisions based on your account data.

FAQ

After how many days does Amazon charge the aged-inventory surcharge in Europe?

Under the FBA Europe rate card in force from 1 July 2026, the Aged Inventory Surcharge starts in the 241–270 day storage band and rises in steps for older stock. The thresholds and rates are updated from time to time, so confirm the current values in Seller Central.

How much is the storage fee in Q4?

For standard-size products outside the apparel categories, the rate on euro-billed EU marketplaces rises from 27.54 EUR to 52.20 EUR per cubic metre per month over October–December, almost doubling. For oversize it rises from 21.78 EUR to 34.49 EUR.

What IPI do I need to maintain to avoid restrictions?

Amazon keeps a minimum threshold below which an account gets inventory restrictions. Historically this has been in the region of 400 points, but it varies over time and by marketplace. Check the current threshold for your account in the Inventory Performance section of Seller Central.

Does the low-inventory-level fee apply in Poland?

The Low-Inventory Cost Coverage fee (Pan-EU) applies on selected marketplaces (including DE, FR, IT, ES) and is not charged in, among others, Poland, the Netherlands, Sweden, Belgium and Ireland. The scope is updated from time to time, so check the rules for your marketplaces in Seller Central.

What should I do with stock that will not sell?

Work out whether continued storage plus the rising aged-inventory surcharge will exceed the cost of removal. If so, choose a price cut, return to seller, disposal or liquidation, before the stock hits the next aged-inventory tier.

Let's talk about your account

If your storage fees are rising faster than your sales, or your bestsellers keep dropping to zero, let's talk about your account. We start with a diagnosis: where the capital sits, what is dragging IPI down, and which inventory decisions will reclaim the most.