How to Deal with Amazon FBA Restock Limits: A 7-Figure Seller's Perspective

Amazon introduced "restock limits" on April 22, 2021. Some sellers have been unable to send fresh merchandise to FBA warehouses due to a lack of storage capacity. Read this article carefully and if you still find any difficulty in dealing with Amazon FBA Restock Limits the you should hire an amazon FBA virtual assistant to do this work for you.

How to Deal with Amazon FBA Restock Limits

In this piece, we'll explain what restock restrictions are, how to deal with them, and provide information to help you prepare ahead.

What are the Restock Limits?

Restock restrictions determine how much inventory of certain categories merchants can keep at Amazon FBA facilities. There are four basic categories: normal size storage, oversize storage, garment storage, and footwear storage. If you sell flammable or aerosol products, there will be distinct storage limitations for each category.

Amazon has imposed further restrictions on how much can be transported to FBA warehouses, and a few things are easily mistaken with refill limits. Here are some of the major ones:

• The Inventory Performance Index (IPI) score. Amazon rates each seller based on their inventory performance. While some criteria may overlap, the IPI score is not the same as restock limits.

• Storage volume or restrictions. Amazon has a unique storage restriction for each vendor. If you have an IPI score of 450 or higher, you'll have infinite storage. If your IPI score is less than 450, you will have storage constraints. Even if you have "unlimited storage," you are still subject to restocking constraints.

• Restock limitations are not determined by volume. Restocking limitations are simply expressed as an absolute number of units. For example, your resupply restriction in a specific category could be 5,000 units. The volume of the units is not taken into account when calculating the resupply limit, but it is taken into account in the storage limit mentioned above.

Why is Amazon adopting restocking limits?

When Amazon first introduced refill limitations, they stated that the intention was to replace ASIN-level storage limits and provide merchants more freedom. Here's an email:

The primary takeaways for me from this are that resupply limitations are intended to be better than previous ASIN level storage limits for sellers, while still allowing Amazon to control inventory levels of sellers with slow moving inventory.

My thoughts on why Amazon implemented restock limits

So, the above is directly from Amazon, and now I'll explain why I feel this shift occurred.

If we look at the evolution of some of Amazon's regulations over time, I believe Amazon's goal for FBA is to be a true fulfillment center rather than a warehouse. This suggests they don't want a large amount of unsold inventory taking up space. They seek inventory in their warehouses that will sell relatively rapidly.

Amazon is rapidly expanding its fulfillment centers and employing employees to work in them. Even at that speed, businesses are likely to face space limits at their FBA warehouses. And even if they aren’t running into these challenges today, they’ve undoubtedly projected some capacity issues in the future.

My explanation for why Amazon is instituting restock limits is to guarantee that only products that sell reasonably quickly enter their FBA warehouses.

When are the replenishment limitations updated?

Restock limitations appear to be updated weekly, between Sunday evening and Monday am. On Monday mornings, we check our latest resupply limit figures. We've been following this statistic every week in hopes of getting closer to reverse engineering and understanding exactly what goes into it.

How is my replenishment limit utilization calculated?

The maximum shipment quantity that can be sent to FBA warehouses at any given time is a crucial aspect of replenishment limits. This is derived by subtracting your maximum inventory level, which is essentially your resupply limit for the category, from your usage.

Here's how Amazon calculates utilization:

Utilization includes both your current Amazon inventory and any incoming shipments, including those in the Working, In transit, and Receiving statuses. The usage calculation excludes inventory that has yet to be removed and any inventory that has been reserved. To get the utilization number by sort type, go to your resupply limits monitor and sort by storage type.

- Seller Central's Restock Limits by Storage Type: Frequently asked Questions

It is vital to note that even working shipments count towards the limit, whereas pending removal orders do not. Understanding usage is critical so that you may ship as many units as possible to FBA warehouses.

How should future resupply limits be addressed?

My guess is that some type of refill limit is here to stay. With that in mind, it is critical to develop a strategy for dealing with resupply constraints in the future. If you currently have enough of usage, no significant intervention is required. If you are currently unable to ship to FBA warehouses, it may be time to take more serious action.

Here are a few options to consider. Some have a greater impact than others, but all have the ability to expand your restocking limitations.

Shipping to FBA in lower quantities

If you are currently shipping three months' worth of product to Amazon at a time, holding this inventory elsewhere and drip feeding a few weeks' worth of material into Amazon FBA warehouses will most certainly allow you to function more comfortably within your restock restrictions.

Evaluate the things you're buying to sell on Amazon

In my company, we have "buying guidelines" that we use to decide whether or not to purchase an item. If you're having trouble with restocking restrictions, reviewing your purchasing criteria may be helpful. When doing this, the idea is to focus on lowering items that are staying in stock for longer than usual.

Evaluate your pricing strategy

This can vary greatly depending on your present strategy, however if you are typically conservative, you could look for opportunities to price at the market level sooner. If you don't have a solid strategy in place, now is the time to develop one.

The seller is fulfilling more things

If you can send more things straight to customers, your items will remain available for purchase without affecting your resupply limits.

Working with a third-party logistics provider

Seller fulfillment becomes easy when you collaborate with a company that stores your goods and ships it when it sells. These companies function similarly to FBA warehouses, however they are not affiliated with Amazon.

Evaluate your advertising, promotions, and couponing approach

In general, all of these will accelerate the rate at which you sell stuff. It does cost money, but running ads or offering customer discounts can enhance the rate at which things sell on Amazon.

Sell more on other marketplaces or through your own website

This can be achieved by using FBA inventory to fulfill orders across many channels, or by simply diversifying.

Get your things dispatched to FBA warehouses as soon as possible

As stated in the utilization section above, working and in transit count towards usage. So, if you are currently delivering LTL and it is taking weeks for your products to appear at FBA warehouses, you should try sending by parcel. If you presently only take your packages to UPS once a week, you may consider scheduling daily pickups or dropping off more frequently.

Final thoughts

Overall, it appears like resupply limits are here to stay, and sellers should plan accordingly. If you have sufficient of capacity, monitoring is likely to suffice. If you are experiencing capacity challenges at FBA warehouses, hopefully some of the solutions in this post will be helpful.

In my company, we intend to implement some of the ideas suggested here, as well as increase our efforts on other marketplaces. We want to make sure we're diversified and that no single move has a significant impact on the firm. If you want best amazon fba automation service then VAamazon is the best choice for you. We have a team of experts who can solve all of your Amazon FBA related issues.

How about you? Let me know in the comments if you have any questions, what your experiences have been with resupply restrictions, and what your strategy is for coping with refill limits.

Thank you for reading.