Amazon has become one of the leading ecommerce giants in the world, with more than 300 million active users.
In the United States, small and medium-sized businesses sell more than 4,000 items per minute on average.
But just like any other business, Amazon merchants face various challenges, including how to manage inventory effectively.
Is your inventory stranded in an Amazon warehouse, generating storage fees, with no way to sell it? You're not alone.
Stranded inventory on Amazon is a common problem among sellers, but there is a solution.
Fixing Amazon's stranded inventory should be your top priority because it can lead to a lot of negative consequences.
If left unchecked, it can cause customer dissatisfaction and even lost revenue.
Read along to discover how to reduce costs, prevent future losses, and ensure your business stays afloat.
If you're an Amazon seller, you may have noticed that your inventory is slowly disappearing.
Of course, it could be a few items here and there. Still, over time, the number of items in your account decreases until you eventually have no products.
This situation is what Amazon refers to as "stranded inventory."
It is sellable inventory that may be in a fulfillment center or warehouse. Still, it does not appear for sale on your site.
What's more, it harms the business because it ties up your cash. You paid for the products, and you're paying for storage, but customers can't purchase them.
As a result, if you do not regularly check your account for any inventory problems, you may be liable for various fees (monthly inventory storage, FBA inventory storage coverage, and FBA long-term storage costs).
Furthermore, Amazon stranded inventory can have a negative effect on your inventory performance index (IPI).
Amazon uses this method to ensure that their sellers optimize their inventory as efficiently as possible, grading their inventory performance on a scale of 0 to 1000.
Your IPI score is a single number that is determined based on four aspects of FBA inventory management:
In 2023, the Amazon IPI threshold is 400 – if you go below that, you can be subject to storage limits.
Remember that Amazon computes your IPI every Monday based on your three-month performance statistics.
Amazon notifies sellers who have stranded inventory and provides them 30 days to either correctly list the product or remove the inventory.
If the limit passes without action, Amazon reserves the right to remove or return any stranded units to the supplier.
Therefore, it is critical to address Amazon's stranded inventory as soon as possible and improve along the way.
Now that you understand the importance of stranded inventory let's look at possible reasons why it happens in the first place.
Listing errors occur when your inventory is not linked to a current ASIN.
For example, a listing may be deleted by accident or by a competitor, resulting in an error.
If that's the case, relisting your goods will return them to stock.
If this simple solution does not resolve the problem, contact Seller support.
When you close a listing, the product you're selling goes into an inactive state, meaning it's no longer visible to customers but still stored by Amazon.
Closing an Amazon listing occurs when you briefly remove or pause a product listing from your Amazon seller account.
When you enable Close Listing, the item shows Not Available next to it, and no one can buy it.
Even though you have stock on Amazon, consumers cannot make purchases, and Amazon will consider it a strand inventory.
Insufficient details in your Amazon listing can result in its deactivation. For example, it often happens when Amazon decides to add a new section to the listing information that is already required.
Usually, this error occurs in the following situations:
Naturally, as with anything, if this doesn't solve the problem, you might have to contact Seller Central.
Amazon reserves the right to remove any item missing required information (such as images, age limitations, bullet points, etc.).
ASINs may be labeled as "restricted" due to bad quality, intellectual property violations, or the need for additional safety testing.
Amazon's conditions of service may also cause a suspension, such as when a large number of returns are received or when prohibited terms or claims are used.
When you attempt to upload multiple products at once, the Bulk upload error occurs, mainly if the quantity column is filled in.
It will convert your listing to "Fulfilled by Merchant" rather than "Fulfilled by Amazon," leaving your inventory stranded.
Pricing issues can cause Amazon stranded inventory. It will instantly flag the listing if your merchandise is priced too high or too cheap.
This error occurs when you change your prices without first checking the Minimum Advertised Prices (MAPs) or when you lower your pricing to significantly less or more than your prior pricing or comparable products in the market.
You can, however, override these problems by setting a minimum and maximum price in the "Manage Inventory" area of Seller Central.
Another option is to return your pricing to a more typical range.
Amazon will mark products as stranded if their expiration dates have passed. Therefore, removing them from the fulfillment center in that situation is best.
To be checked into FBA facilities, products must have enough time to consume and an extra 90 days.
For example, if a product has 30 servings, the overall shelf life must be 90 days + 30 days, or 120 days, for Amazon to accept it.
As a result, if your product does not sell fast enough, it may be labeled as expired and stranded.
According to Amazon, expiration dates must be written in the following format: MM-DD-YYYY.
These labels must be visible, in size 36 font or higher, on both the master carton and the individual units. In addition, each carton can only have one expiration date and not show the manufactured date.
When your product becomes stranded, Amazon will usually notify you.
It is your responsibility as a seller to correct inventory errors within 30 days of being informed.
If you do not respond within that time, Amazon will remove and dispose of the inventory from the warehouse.
As inconvenient as stranded inventory is, there are steps you can take to avoid it:
To begin, log into your Seller Central account and navigate to the Inventory area.
You'll be able to control your inventory inside. For example, if you have any goods flagged as stranded inventory, a section labeled "Fix Stranded Inventory" will appear.
Once you've identified your stranded inventory, you'll need to fix it.
You can do this by creating a new product listing for the affected items or updating an existing listing to include them.
You can do it manually through the Amazon seller account or using third-party tools to automate the process.
If you cannot fix the stranded inventory, you can request the removal of the inventory from Amazon's fulfillment centers or dispose of it yourself.
However, it's important to note that removing or disposing of inventory can incur additional fees.
Therefore, it's best to try to sell or move the inventory first, if possible.
To prevent future instances of stranded inventory, you should regularly monitor your inventory and listings to ensure that your products are correctly associated with active listings.
It means checking for inactive listings and updating or merging them as needed.
Additionally, you should regularly review your inventory levels to ensure you have enough stock to meet demand without overstocking.
Having to repeatedly contact Seller Support because of this problem is a major hassle.
However, you can attempt to avoid stranded inventory in the first place by avoiding the most common reasons why Amazon flags products as stranded inventory in the first place.
Then, you can follow these additional best practices.
✅ Before sending in FBA shipments, make sure your listings are complete.
When you create a listing, you don't need to immediately complete additional steps, such as product features and images.
However, if you don't include them before the shipping, it will increase the chance that the items will become labeled as "stranded."
So getting them done first will prevent issues with the listed inventory.
✅ Before committing products to your FBA warehouse inventory, you should conduct research.
When dealing with dropshipping on a wholesale basis, it is important to ensure that you have the authorization to sell the product in question.
✅ Ensure that all FBA shipments are 100% correct.
You must establish a shipping strategy before sending your product to FBA warehouses.
If you sent items to the warehouse that are not included in your shipping plan or received more inventory than was mentioned in your shipping plan, your inventory might be stranded.
Double-check the information on your shipping plan to prevent any problems during check-in.
✅ Wait to remove your listings.
If you have run out of supply and do not intend to replenish it, do not immediately delete your offer from 'Manage inventory.'
If you do, any potential lost inventory or returns will be stranded without an active offer.
✅ Set the lowest and maximum prices for your products.
If you put your price below or above your minimum and maximum price settings, Amazon will disable your listing.
For example, you specify the minimum price for a product at $30 but list it at $29.98. Then, your listing will be disabled, and your inventory will be stranded.
Amazon's stranded inventory is a common issue for many sellers, and it can significantly impact their business.
To solve stranded inventory issues on Amazon, you should start by identifying the root cause of the problem.
It means looking over the product listings, keeping an eye on the number of items in stock, and fixing any problems with order fulfillment.
You can also use Amazon's tools and resources, such as the Stranded Inventory Report and the FBA Removals report, to step up your inventory management game.
In general, fixing stranded inventory on Amazon requires being proactive and being ready to deal with problems as they come up.
By taking the time to understand the causes of stranded inventory and implementing the right solutions, you can ensure that your products are always available to customers and that your businesses thrive on the Amazon platform.
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If you do not take action on the stranded inventory within 30 days, Amazon will remove it from the warehouse immediately.
The main distinction is that stranded inventory is inventory that does not have an active listing, and as a result, all inventory for that ASIN becomes stranded, or unable to be sold.
Attached to a live listing is unfulfillable inventory, which is usually just a small amount of the inventory for that ASIN that can't be sold for a number of reasons, such as being damaged or returned.