What factors affect the IPI score of Amazon inventory performance indicators

2022-11-21
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Author:Blue Ocean Yiguan
Source: egainnews

What factors affect the IPI score of the cross-border e-commerce platform Amazon inventory performance indicator

To help sellers measure inventory,AmazonHas developed a program calledAmazon Inventory Performance Indicator (IPI)Or IPI score. IfAmazon SellerofIPIThe score drops seriously, and they may receive the notice of suspension of sales from Amazon.

Therefore, sellers should keep a close eye on inventory indicators.Blue Ocean Yiguan has learned that,influenceAmazon inventory performance indicator IPISome of the factors for includeExcess Inventory、In-Stock Inventory RateandStranded Inventory。

What factors affect the IPI score of Amazon inventory performance indicators of e-commerce platform

IExcess Inventory

AmazonExcessive inventory is caused byIPILow is one of the most important reasons. In essence, any time the price of stored products exceeds the cost of removing excess inventory, it is considered as excess inventory.

Amazon calculates inventory performance by checking the seller's product requirements and all costs associated with storage products. Amazon FBA seller's standard price includes storage fee, cost per unit and the seller's company's capital investment.

For example, if the seller hasIf more than 50 items have not been sold in the past 90 days, the IPI score will drop。 Amazon knows that the seller's sales of this product are slow, which increases storage costs and requires money to purchase.

In order to improve the excessive inventory score, the seller should focus on cleaning up those unsalable products, and ensure that the product price is reasonable and there is a certain demand. The seller can also useFBATo track inventory levels and avoid short selling.

2、 In Stock Inventory RateSpot inventory rate

Another factor that affects IPI scores isIn-Stock Inventory Rate。 If Amazon sellers want to store more products in the FBA warehouse, they must keep the products in stock. If SKUs continue to sell out without spare stock, Amazon will reduce its IPI score.

What factors affect the IPI score of cross-border outbound Amazon inventory performance indicators

So, how does Amazon calculate the seller'sIn-Stock Inventory RateWhat about?

The seller was assigned a 60 day rolling average to measure this indicator. By viewing the seller's productHow much inventory has decreased in the past 30 to 60 daysAmazon FBA can calculate how long the seller needs to restock.

However, what should we do if the brand stops production, or the seller is unable to purchase any more, and the seller does not plan to purchase any more?

Amazon can distinguish between goods that the seller purchases regularly and goods that the seller does not plan to purchase again. Therefore, when providing certain ASINs, the seller may not notice that the inventory performance index is deducted.

In view of this, in order to improveIn-Stock Inventory RateThe seller should ensure that the delivery is arranged according to the demand to avoid short selling. The seller can also use Amazon's automatic replenishment tool to ensure that the goods in the FBA warehouse will not be sold out again.

3、 Stranded Inventory

Amazon's stranded inventory is the third factor affecting Amazon's seller's IPI score. The stranded inventory refers to the goods that occupy space in the FBA warehouse but are not sold fast enough for Amazon to sell. Although the seller's products may not sell, there is still demand. Otherwise, the inventory will not be stranded.

Examples of inventory hold up:

1. The seller has eliminated the old product because a new version is available.

2. Kit style suite e-commerce products may be lost, damaged or misplaced during use.

When reviewing the business performance summary, it is necessary to track the percentage of stranded inventory.According to Blue Ocean Yiguan,The percentage of stranded inventory is a special calculation method that Amazon uses to evaluate how much inventory is in the warehouse, which takes up space without selling.

What factors affect the IPI score of Amazon inventory performance indicators of e-commerce platform

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