US Inventory Performance Index (IPI) Threshold Change for 2020 and Free Removals Promotion


#42

Don’t assume that. I think this is happening now. January 2020 is just the first quarter that will have limits imposed (based on IPI scores under 400 in mid-November and last December of this year). I hope I’m wrong.


#43

When your inventory jumps from 500 units to 10,000+ units over 60 days without a proportional increase in sales, there is an impact.


#44

We discussed your long tail books issue 2 years ago…
I understand your argument, and disagree with it…
Here is my question…why you want to jump from 500 to 10000 …why you assume that if they did not sell FBM, the magic will happen in FBA ? If these are special books, than the “unique” buyer will purchase the from FBM .
Amazon is not interested in items that sell extremly slow.
In your example, you have to be realistic…how many items you really expect to sell, and only according to this ship items to FBA…


#45

I don’t sell books. I haven’t FBM’d since 2012.

90+% of what I send in will sell. It can’t sell if I don’t send it in. I would rather have limits in Q1 than handicap Q4 by holding back inventory. (But it is very, very, very unlikely that I will have limits; though the mid-November IPI score may be doubtful, the end-of-year score will be boosted by the massive increase in sales.)

I am not seeking your advice on how to run my business. Everything is great here.


#46

Maybe I was wrong who was the poster from 2 years ago.


#47

IPI is a nightmare for seasonal items. Seasonal items are items that have peaks only for a week or two in a year and flat for the rest the year. By “peak” I mean the sales can go up by 100 times during the “peak”.


#48

yep im a seasonal seller. we do north of 100k a day in the month of october. its been VERY challenging to keep our ipi above 350 this past year in preparation for q4 limits. this is especially rough for halloween sellers. we dont really havemany items to sell during off season. and we keep almost ZERO inventory at fba during off season. only what can sell in a 45 day cycle. and yet we were NEVER above 400 during off season. i dont see how this will work honestly. do they expect us to start another company just for ipi purposes? we dont even keep stock in after halloween is over. minus a few high end licenses on a 45 day cycle. i’m not sure what on earth we are supposed to do. i have friends who have left the fba program and gone full SFP due to this. but we arent located in one of the test areas like the los angeles or nyc guys. ( their newst ship program) that is amazon ship rate.


#49

You are not allowed to have second account. Even if approved, how this will help the IPI ?


#50

Three months of “what data”? What is the equation? Give an example equation of how the score is calculated.


#51

Study this help file…you will understand https://sellercentral.amazon.com/gp/help/202174810


#52

Thanks, but it doesn’t. It’s general information without the specific IPI “equation”. The only equations given are:
Average available inventory = (50 + 40 + 150 + 80) / 4 = 80
Sell-through rate = 120/80 = 1.5

This doesn’t explain how the mysterious IPI is determined. Nobody from Amazon will provide. There are several other forum topics at length about the same.


#53

The IPI is the combination (or sum) of all the other factors like excess inventory,sell through, and more…keep these in good shape and your IPI will be good.
No need for exact formula that we have no control over it.


#54

Thanks for your reply. Understanding the numbers in the mysterious formula will allow Sellers to understand and pinpoint what is causing their score to fluctuate. Without knowing, there is no way to optimize your performance and focus on the real issue with lower scores. With Amazon not coming forward with exact information raises suspicion into the use and intent of the IPI score.


#55

At the 2018 FBA Boost conference in New Orleans, Amazon representatives gave a somewhat informative presentation and mentioned that they consider a “perfect” IPI to be in the 450 to 550 range. That seemed reasonable given a 350 minimum. With the increase in the minimum IPI to 400, I can only assume that the “perfect” range has to adjust as well.

My best guess is that they looked at the number of sellers in the 350 to 400 range and determined that it won’t affect too many sellers if they raise the range. The problem with that line of thinking is that the increase will affect anyone in the 400 to 500 range as well. If you’re at a 450 when the minimum is 350, then you’re probably not going to consider drastic measures to change your numbers. With the increase to 400 it not only affects sellers in the 350 to 400 range but also sellers in the 400 to 500 range.

It will result in many sellers, who were in the “perfect range” to re-evaluate their business model and make adjustments. It is what it is and we will all have to comply but I don’t believe that they gave much thought to how it affects sellers who they told last year were within their “perfect” or “ideal” range.

My current IPI is 474 and it tends to vary up and down by 1-3 points per week. I am now concerned (with less than 100 point margin) where I was not concerned before with the 350 minimum. This will affect how I run my business and I will need to make some adjustments to increase my IPI to the +500 range. I’m sure I’m not alone in my position or concerns.


#56

I imagine that they define the “perfect range” by what keeps their warehouses full enough to charge lots of storage fees, but moving well enough to keep all their associates busy earning picking and packing fees. Little relation to what makes a good business for the seller.


#57

@SHAHAR My highest IPI was 836 points. Then after I discontinued that low-profit product, IPI decreased by -322 in 3 weeks after I ran out of stock and closed the listing for that product. My IPI is now 506 points. For 1 year, my sell-through rate was between 3.0 and 6.34, everything else at maximum green values. And yet the IPI could one week increase by 10 points and next week decrease by 7, without much changes in performance indicators. I even had several cases when sell-through was increasing week after week but the IPI was decreasing with everything in green. So like I said, IPI makes no sense at all and is not helpful for sellers.


#58

No. -322 points sent me to 506 points in 3 weeks. Now I have 506 points but most likely it will further decrease on Monday.


#59

Your numbers are really strange because usually the movement of the IPI is very moderate.
Few possibilities I can think of, but not sure this is what happened… some glitch within amazon.
The item you discontinued was really a big seller, and when it stoped, it shook up your entire operation.
The items left in FBA are not good sellers, large number of excess inventory.
Shipments to FBA were not recorded properly and messed up your quantities.
My current IPI is 826, and I don’t remember ever change of over 20-30 points in a week, and I knew that it was justified.


#60

Thanks for sharing your number. I always want to know others’.

My IPI is 462.

My greatest concerns with IPI:

  1. Seasonal items. I hesitate how many I should ship, shoud I ship a lot and throw unsold one later or ship less and risk having an out of stock.

  2. NEW products. It’s scarry to release new products. It takes time for new entries to take of. What if it drags the IPI down.

Humbly, I cc @SEAmod


#61

IPI is calculated on a 90 day rolling basis; so your drop could be based not on the fact that you had a decent week, but rather that you had a fantastic week drop off.