Weekly Amazon FBA Inventory Management Strategies

After 10 years on Amazon, I've found that storage fees can kill your profitability. Here's the brutal math: • FBA storage (Jan-Sep): $0.78 per cubic foot • FBA storage (Oct-Dec): $2.40 per cubic foot • Long-term storage (271-365 days): $1.50 per cubic foot • Long-term storage (365+ days): $6.90 per cubic foot These fees compound during growth phases, creating financial pressure during expansion. Enter AWD – Amazon's bulk storage solution designed to complement FBA: • AWD rate: $0.42 per cubic foot year-round (vs. up to $2.40 for FBA) • No inbounding fees for AWD users • Eliminates FBA's storage limits and overage fees • Auto-replenishes your FBA inventory For our clients, we implement a hybrid model: → Store 60-90 days in AWD → Keep 30-60 days in FBA This strategy balances inventory availability with minimized storage costs. For peak seasons, increase to 90 days before Q4 to handle surges. This optimization strategy improved one client's cash position by $48K annually while maintaining perfect inventory levels. Are you still storing all your inventory in FBA? You're probably paying 2-5× more than you should.

I just watched a DTC brand lose $1.2M in Amazon sales. Their crime? Running out of stock for 3 weeks. Here's what most sellers don't understand about Amazon: It's a MOMENTUM game. When you run out of stock: ✎ Your organic rankings plummet ✎ Amazon's algorithm penalizes you ✎ Competitors steal your customers ✎ Rebuilding takes 3-5× longer than the stockout period The math is brutal: ✎ 3 weeks out of stock ✎ 3-4 months to recover ✎ $1.2M in lost sales This isn't theory. I've seen it happen repeatedly. The solution? A proper inventory management system: ✔ AWD (Amazon Warehousing & Distribution) as a buffer ✔ Maintain 60-90 days in AWD, 30-60 days in FBA ✔ Create FBM backup listings for emergencies ✔ Set reorder points based on lead time + buffer When we implemented this for our clients, stockouts became a thing of the past. One client went from 6 stockouts per year to ZERO. Their sales increased 43% year-over-year just from consistent inventory. No marketing genius required. Just boring, effective systems. Is your inventory management leaving money on the table?

Inventory misses = ruined profits + no cash This infographic shows 7 metrics to review weekly to keep inventory under control: # 1 - Stockout Frequency ↳ What: how many times each SKU went out of stock this week ↳ Why: repeated stockouts point to demand surges, planning errors, or supplier delays ↳ Calculation: Count of stockout events per SKU during the week # 2 - Weeks of Supply (WOS) ↳ What: how long current inventory will last based on recent consumption ↳ Why: helps flag SKUs at risk of future stockouts or excess ↳ Calculation: On-Hand Quantity ÷ Average Weekly Demand (last 4 weeks) # 3 - Inventory Turns (Weekly View) ↳ What: how efficiently you’re rotating stock ↳ Why: low turns tie up cash; high turns increase stockout risk ↳ Calculation: (COGS for week ÷ Average Inventory Value) × 52 # 4 - Inbound Plan vs. Actual ↳ What: planned vs. actual deliveries from suppliers ↳ Why: variances affect availability and future production or orders ↳ Calculation: % of purchase orders delivered on time and in full (OTIF) # 5 - Outbound Plan vs. Actual ↳ What: were outbound shipments made as scheduled? ↳ Why: delays impact customer service and revenue recognition ↳ Calculation: % of outbound orders shipped on time and in full # 6 - Aging Inventory ↳ What: items sitting in stock for too long ↳ Why: aging stock becomes obsolete, expired, or devalued ↳ Calculation: Value or quantity of inventory aged over 90, 180, 360+ days # 7 - Fast-Mover Coverage ↳ What: how many weeks of stock you have for your top 10–20 fastest-moving SKUs ↳ Why: these SKUs often drive the business ↳ Calculation: On-Hand Qty ÷ Average Weekly Demand (top SKUs) Any others to add?

🚨 𝐀𝐫𝐞 𝐲𝐨𝐮 𝐦𝐚𝐤𝐢𝐧𝐠 𝐢𝐧𝐯𝐞𝐧𝐭𝐨𝐫𝐲 𝐝𝐞𝐜𝐢𝐬𝐢𝐨𝐧𝐬 𝐛𝐚𝐬𝐞𝐝 𝐨𝐧 𝐠𝐮𝐭 𝐟𝐞𝐞𝐥𝐢𝐧𝐠? It is time to level up with 𝐀𝐁𝐂 𝐗𝐘𝐙 𝐀𝐧𝐚𝐥𝐲𝐬𝐢𝐬 — the ultimate duo for smarter stock management. 🧠📦 Let us break it down so you can optimize inventory, reduce waste, and keep customers happy. 🔍 What is ABC XYZ Analysis? It is a combined inventory classification method used in supply chain and inventory management. It merges two powerful frameworks: 𝐀𝐁𝐂 𝐀𝐧𝐚𝐥𝐲𝐬𝐢𝐬: Categorizes inventory based on 𝐯𝐚𝐥𝐮𝐞 𝐜𝐨𝐧𝐭𝐫𝐢𝐛𝐮𝐭𝐢𝐨𝐧 (e.g. revenue or cost). ↳ A-items: High value, low quantity ↳ B-items: Moderate value and quantity ↳ C-items: Low value, high quantity 𝐗𝐘𝐙 𝐀𝐧𝐚𝐥𝐲𝐬𝐢𝐬: Classifies items based on 𝐝𝐞𝐦𝐚𝐧𝐝 𝐯𝐚𝐫𝐢𝐚𝐛𝐢𝐥𝐢𝐭𝐲. ↳ X: Predictable demand ↳ Y: Moderate demand variability ↳ Z: Highly irregular demand By combining them, you get a 3x3 matrix (like AX, BY, CZ...) to identify what really matters in your inventory. ⚙️ How does it work? 1️⃣ Run ABC classification by analyzing cumulative consumption value (Pareto principle). 2️⃣ Run XYZ classification by calculating demand variability (coefficient of variation). 3️⃣ Cross-tabulate the results to assign inventory strategies: ↳ 🔺 AX: High-value & stable → tight control, frequent review ↳ 🔻 CZ: Low-value & erratic → minimal investment, possibly phase out 📦 Real-Life Example Imagine a retailer with 1,000 SKUs: ↳ iPhones: High value, stable sales → AX ↳ Phone cases: Low value, steady demand → CX ↳ Christmas lights: Low value, unpredictable sales → CZ Now the retailer can: ✅ Prioritize planning and forecasting for iPhones ✅ Bulk order phone cases less frequently ✅ Avoid overstocking seasonal items 🎯 Benefits ↳ Improved forecasting and procurement ↳ Reduced holding and obsolete inventory costs ↳ More focused inventory strategy ⚠️ Challenges ↳ Requires accurate data and analysis ↳ Demand patterns may shift (e.g. due to market trends or seasonality) ↳ Risk of oversimplifying complex SKUs ✅ Conclusion ABC XYZ Analysis is not just a tool — it is a strategy. By classifying items based on value and predictability, you can drive efficiency, cut costs, and boost customer satisfaction. 📈 ✨ Whether you are in retail, manufacturing, or logistics — this technique can transform how you manage stock. 𝐒𝐭𝐚𝐫𝐭 𝐚𝐧𝐚𝐥𝐲𝐳𝐢𝐧𝐠, 𝐬𝐭𝐚𝐫𝐭 𝐨𝐩𝐭𝐢𝐦𝐢𝐳𝐢𝐧𝐠.

Inventory will make, or break, your Amazon FBA business.   You can take all the right actions with your marketing to scale your sales on Amazon.   And your sales grow, let's say, 37%. 🤑   And your listing rank went from 4,372 to 2,371 organically. 🎉   But if you forget to ship your product in on time…   In just one week your organic rank will revert from 2,371 to 4,372+. 🙁   Organic rank comes slowly.   It goes quickly.   Staying in-stock is critical if you want to succeed on Amazon.   Start with ABC classification.   Break your products into three tiers:   A Tier: Greater than 5%   B Tier: 1-4.99%   C Tier: Less than .99%   Next, identify your lead time - how many days does it take to get product in?   Finally, identify your unit sales velocity.   Combine these three together, ABC classification, lead time, sales velocity.   Build an excel & run the report weekly to identify what is running low based on your recent sales velocity, & how soon you need to ship accounting for lead time.   Analyze your excel every Monday.   Never let you’re A tier go OOS.   Always keep up with B tier products, trying to get the lead time just right.   For C tier, do your best, but if cash is tight, or time is thin, it's okay to go OOS on C tier's occasionally as it will be low impact on your sales.   #Amazon #Inventory #ecommerce #digitalmarketing #sales