IPI frequently asked questions

This page provides answers to common questions about Inventory Performance Index (IPI).

The IPI score and inventory performance dashboard are only available for sellers with a Professional selling plan.

How is IPI calculated?

IPI score measures how efficient and productive you are in managing your FBA inventory. Multiple factors can influence your IPI score, but it is important to do the following:

1. Maintain a balanced level of inventory with high sell-through rate and reduce inventory with high weeks of cover to avoid overstock. Avoid Long-term Storage Fees.
2. Fix listing problems.
3. Maintain appropriate level of inventory to meet customer demand and maximise customer satisfaction especially for your most popular products.

Your IPI score is designed to represent your overall inventory performance. When you take actions to improve your inventory efficiency, these actions can take time to result in an improved IPI score.

What’s the best way to improve my IPI score, and what should I prioritise?

While everyone’s business is different, we recommend the following general guidelines to manage your inventory performance:

• Improve your 90-day rolling sell-through by maintaining a sell-through that places you in the green (or ‘good’) range throughout the year. For recommendations, go to FBA inventory age. Filter by inventory age ranges or sort the FBA sell-through column to view products with the lowest sell-through. You can improve your sell-through by:
  
  1. Improving the balance of your sold and in-stock inventory by increasing your sales.
  2. Removing inventory that is not selling. For more information, go to Remove inventory (overview).
• Fix listing problems promptly by regularly checking your FBA Stranded Inventory. Stranded Inventory means that you have sellable products in an Amazon fulfilment centre that have no active listing, and therefore cannot be sold. Inventory that incurs fees without the possibility of sales can reduce your IPI score.
• Avoid keeping higher than required inventory and regularly take actions to bring it back an appropriate level, required to maintain 30 to 60 days of expected sales.
• Running deals and coupons, advertising with Sponsored Products and best practices for listing quality improvements can be a great way to sell your overstocked and out-of-season products. Reduce or avoid FBA long-term storage fees by removing inventory before it reaches 365 days. For information on how to create a removal order, go to Remove inventory (overview).

Why should I improve my IPI score

As IPI measures the efficiency and productivity of your FBA inventory over time, higher IPI scores usually indicate that you are managing your inventory more efficiently. This means that you are optimising your sales and minimising your storage costs, and may result in an improved storage limit allocation during the next quarterly adjustment cycle.

Do new ASINs affect my IPI score?

New ASINs in their first 90 days don’t affect your IPI score.

How and when storage limits determined?

For information, go to FBA inventory storage limits.

Are removals included in IPI?

Once a removal order request is placed, the inventory no longer affects your IPI score. Remember that actions taken today, such as a removal order, will take time to be reflected in your IPI score.

How can I improve my sell-through rate?

You can improve your sell-through rate by increasing sales in relation to your in-stock inventory or removing inventory that is not selling. To improve sales, review your pricing and consider one or more of these options:

• Creating sales such as running deals and coupons.
• Improving keywords by using search terms effectively.
• Promoting your listings with advertising such as Sponsored Products.

If you ship a lot of inventory to Amazon, your sell-through rate could be affected if your sales do not keep pace with your shipments over the same time period.

How is the sell-through rate calculated?

Sell-through rate is updated daily and looks at past 90 days of shipped units and average inventory over that same period. We encourage you to try to maintain a sell-through rate in the green (or ‘good’ rating) year round.

Your FBA sell-through rate is your units sold and shipped over the past 90 days divided by the average number of units available at fulfilment centres during that time period. We take a snapshot of your current inventory levels of 30, 60, and 90 days, to calculate the average units available. For example: You shipped 120 units in the past 90 days, and you had an average of 80 units available during that time period. Your sell-through rate would be 120/80 = 1.5, as shown below.

Average available inventory = (50 + 40 + 150 + 80) / 4 = 80 units

Sell-through rate = 120/80 = 1.5

Why don’t I have an IPI score?

You will only be able to view your IPI score if you have a Professional selling plan, inventory at a fulfilment centre, and recent account activity. If you are new to FBA or have not been active in the past 13 weeks, you may not have an IPI score until more data becomes available.