Amazon just announced that it will be imposing a storage utilization surcharge for the monthly storage fee, which takes effect on April 1, 2023.
The surcharge will be based on your storage utilization ratio, or the ratio of your average daily inventory volume stored in cubic feet divided by the average daily shipped volume in cubic feet over the trailing 13 weeks.
It will only apply to Professional sellers with a storage utilization ratio above 26 weeks. The storage utilization ratio will be calculated on the last day of the month, and the corresponding surcharges will be applied as part of the storage fee charges of the following month.
At the outset, the imposition of a storage utilization surcharge is likely a major concern for sellers with high storage utilization ratios. In the long run, this could necessitate working with a reliable third-party logistics company (3PL) in order to avoid the surcharges, which will potentially drive 3PL prices way up. In the short run, sellers will be forced to either quickly reduce their inventory levels stored in Amazon FBA or find quick ways to significantly increase sales velocity.
Based on the table provided, the surcharge will affect inventory stored inside Amazon FBA warehouses for over 6 months (charges apply beginning on the 181st day). This will likely impact many third-party sellers, as having 6 months’ worth of inventory has been the rule of thumb for running a sustainable Amazon business for years.
Here you can view a screenshot of Amazon’s e-mail regarding the matter:
| Storage utilization surcharge will be available for monthly storage fees Hello, Effective April 1, 2023, we will introduce a storage utilization surcharge for monthly storage fees to align the fees with our underlying costs. This surcharge will apply for sellers who have a storage utilization ratio that’s above 26 weeks and meet the surcharge criteria. The storage utilization ratio is your average daily volume (in cubic feet) that’s stored divided by the average daily volume (in cubic feet) that’s shipped. This calculation is done for the past 13 weeks. Review your storage utilization ratio estimates for January 31, 2023: – Standard-size storage: >52 weeks – Oversize storage: Not applicable If one or both of your storage utilization ratios are above 26 weeks on April 30, 2023, you will be charged the surcharge in May. To prevent the storage utilization surcharge, you must reduce your storage utilization ratio. You can sell more inventory, or request a liquidation, removal, or disposal order to reduce your storage utilization ratio. For more information, go to these help pages: “FBA inventory overview” https://sellercentral.amazon.com/help/hub/reference/external/GTMXYZN64UJL7TT6 “Remove inventory (overview)” https://sellercentral.amazon.com/help/hub/reference/external/G200280650 “2023 FBA monthly storage fee and aged inventory surcharge changes” https://sellercentral.amazon.com/help/hub/reference/external/GJ9NNG7RK4TU6E3Z The Fulfillment by Amazon team |
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