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Ask Amazon: Simplified FBA capacity limits Q&A with FBA team

by Kelly_Amazon

Hello Sellers,

Welcome to our Ask Amazon Q&A with the Fulfilled by Amazon team, focusing on our updated capacity limits and Capacity Manager. We recently announced that we’re replacing the weekly restock limit and quarterly storage limit with a single monthly capacity limit per storage type to give you more predictability and control over your inventory.

This topic will be open today, 3/14/2023 until 5 PM PST. We have moderators closely watching this thread throughout the day, and they may merge posts with similar questions so we can answer them all in one place.

We encourage you to use this thread to ask questions related to the updated FBA capacity limit, which is influenced by your IPI score, as well as other factors such as sales forecasts for your ASINs, shipment lead time, and fulfillment center capacity. The FBA team incorporated seller feedback to include the following improvements:

  • A single, month-long FBA capacity limit. You've told us that having weekly restock limits can make it difficult for you to plan how much inventory to procure and manufacture and that navigating two sets of limits that are measured differently, storage limits and restock limits, can be confusing. FBA capacity limits will resolve these pain points by offering a single monthly limit to determine how much inventory you can send to and store at Amazon. Capacity limits for the upcoming month will be announced in the third full week of each month via the Capacity Monitor in Seller Central and an email notification. To learn more, go to FBA capacity limits.
  • Estimated capacity limits to help you plan three months in advance. In addition to your upcoming monthly capacity limit, we'll provide estimated limits for the following two months to help you plan. Estimates may vary up or down based on how efficiently you are using capacity, as measured by your Inventory Performance Index (IPI) score, and how much space and labor we have available to support you.
  • The opportunity to request a higher limit. With our new Capacity Manager, you can request additional capacity based on a reservation fee that you specify. Requests are granted objectively, starting with the highest reservation fee per cubic foot until all capacity available under this program has been allocated. When your request is granted, the reservation fee is offset by performance credits that you earn from the sales you generate using the extra capacity. Performance credits are designed to offset up to 100% of your reservation fee, so you don't pay for the capacity as long as your products sell through. Our goal is to provide you with more control over how much space you can have while limiting unproductive use. We've piloted this feature with certain US sellers, and we're excited to expand it so all sellers can request higher FBA capacity limits. To learn more, go to Capacity Manager.
  • FBA capacity limits in volume (vs. units) to better reflect your capacity usage. We'll set capacity limits and measure your inventory usage by volume, which better represents the capacity that your products use. We know many sellers prefer to plan in units, so we'll continue to show inventory usage in units and provide an estimate of how many units your capacity limits permit. Like restock limits today, capacity limits consider inventory that is on-hand in Amazon's fulfillment centers and shipments you’ve created that have not yet arrived.

Like storage limits today, overage fees will apply if your on-hand inventory in Amazon's fulfillment centers, not including open shipments, exceeds your capacity limit. Overage fees are calculated based on the highest estimated or confirmed limit that we provided for the given period. Overage fees help prevent excessive inventory levels and shouldn't affect sellers who maintain healthy inventory levels. To learn more, go to FBA inventory storage overage fees.

Your FBA capacity limit is influenced by your IPI score, as well as other factors such as sales forecasts for your ASINs, shipment lead time, and fulfillment center capacity. You can view your capacity limit that will take effect on March 1, as well as your estimated limits, in the FBA dashboard.

Our FBA team is reviewing your questions and we’ll do our best to respond to them by 5 PM PST tomorrow (3/15).

Please note that the team cannot provide legal advice or otherwise interpret regulatory requirements on situations that are specific to individual sellers.

Tags: Ask Amazon
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Seller_5Q2EN2JT16Smp
In reply to: Kelly_Amazon's post

If we were to request additional capacity (and granted):

- Is performance credit only counted for sales of inventory that is part of additional capacity?

- Is reservation fee charged only on inventory that is part of additional capacity? or is it charged in full by paying period if not sold through within reserved time.

- Does capacity limits drop back down immediately after our reservation time is up? if it does, does that mean we will charged overage fee any remainder of the inventory sent during reserved time?

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Seller_YDrsrmCI9K5i4
In reply to: Kelly_Amazon's post

Hello,

When will April storage capacities be confirmed?

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Seller_9kxv7dY1Vfj9P
In reply to: Kelly_Amazon's post

If you are within your capacity limits one month and then the new month arrives putting you above your capacity limits, are you charged overage fees?

For example, if in April I'm using 5,000 cubic feet out of a limit of 6,000, but my limit for May is scheduled to go to 3,000, am I going to be charged overage fees if I'm over 3,000 cubic feet in May even though I didn't send in more inventory?

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Seller_9kxv7dY1Vfj9P
In reply to: Kelly_Amazon's post

How do the capacity limits affect Amazon Global Logistics (AGL) shipments? For example, I am booking AGL shipments now for arrival in June and July, which are months I do not yet know what my storage capacity will be. What happens if these shipments arrive and put me over my storage capacity? Will I be charged overage fees?

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Seller_9kxv7dY1Vfj9P
In reply to: Kelly_Amazon's post

On March 2, Amazon sent out an email titled: "Important update regarding your inventory at AFW." This email says:

"If your Inventory Performance Index (IPI) score is being affected by this closure, we will ensure your capacity limit is not negatively affected and will allow you extra capacity if necessary, beginning now and for at least 13 weeks after AFW1 is reopened. We’re aware that the stranded inventory can impact your IPI score and this incident was out of your control. We will share further details in the coming weeks to help navigate this situation."

How does one obtain the extra capacity that is being offered?

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Seller_eG0npZdyUFmSN
In reply to: Kelly_Amazon's post

Hello,

How can we request more storage space for flammable inventory?

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Seller_D80Lwodq6GAEv
In reply to: Kelly_Amazon's post

Since we sell seasonal products (Christmas), we have trouble every year getting enough capacity to ship what we can sell. Our current IPI is great from the holiday and the current limits are fine, but both will drop as the year progresses.

What will be the lowest capacity limit for professional sellers?

Will the previous year's sales be factored into our Oct-Dec 2023 capacity limits?

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Seller_DGBIl7qlgUC59
In reply to: Kelly_Amazon's post

How do you calculate the overage fee?

For example, my current limit is 2000 cubit feet, and one shipment get to amazon with 300 cubit feet extra on March 15th. So, my total usage is 2300 cubit feet. How would I be charged for extra inventory the rest of March?

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Seller_xIg5xRJ8UD472
In reply to: Kelly_Amazon's post

Can you explain why I'm unable to see my storage volume limit for both dangerous and non-dangerous goods?

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Seller_uItZ6gBdiQ481
In reply to: Kelly_Amazon's post

Is this only for the US ?

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