If you’re an Amazon seller using Fulfillment by Amazon (FBA), you’ve probably heard the term capacity limits more than once. It can feel a little intimidating, especially if you’re new to the program and just trying to get your inventory in front of customers. But don’t worry, capacity limits aren’t as complicated as they sound. Let’s walk through what they are, why Amazon uses them, how to view them, and how you can manage them effectively.
Think of capacity limits as Amazon’s way of balancing space in their warehouses. Since millions of sellers use FBA, Amazon has to make sure everyone gets fair storage space while also keeping their fulfillment centers running smoothly.
In simple terms, capacity limits are the maximum amount of inventory you can send and store in Amazon’s fulfillment centers. These limits help prevent overcrowding while ensuring products that customers actually want are always in stock and ready to ship.
How Are Limits Determined?
Your FBA capacity limits aren’t random. Amazon calculates them based on a few key factors:
- Sales performance: The better your sales, the more space you’re likely to be allocated.
- Historical inventory levels: If you manage your stock efficiently and avoid overstocking, Amazon rewards you with more room.
- Inventory Performance Index (IPI): This score measures how well you’re managing inventory – things like sell-through rates and how often you’re out of stock. A higher IPI generally means higher capacity.
Amazon updates these limits regularly, so what you’re allowed to send in one month may be different the next. This is especially true from October through January during the holiday sales months.
How to View Your Capacity Limits
Amazon makes it pretty straightforward to see your current capacity limits inside Seller Central. Here’s how you can check:
- Log into Seller Central and go to the Inventory Performance Dashboard.
- Look for the FBA Dashboard section, it’s where Amazon shows your storage and restock limits.
- You’ll see your limits broken down by storage type (standard-size, oversize, apparel, footwear, etc.).
- Each limit will show both the maximum units allowed and how much of that space you’re currently using.
This dashboard is your go-to place to keep an eye on your space, especially during high-demand seasons when limits can shift quickly.
The Impact of Capacity Limits
Capacity limits can affect your business in a couple of ways:
- Restock restrictions: You may only be able to send in a certain number of units at a time. If you try to ship more than your limit, Amazon won’t accept it.
- Storage limitations: If you hit your maximum capacity, you’ll need to sell through existing stock before sending in more.
- Seasonal adjustments: During peak shopping seasons (like the holidays), Amazon often tightens capacity limits to manage the surge in inventory.
How to Work Within Your Limits
Here are some strategies to make the most out of your available storage:
- Plan your shipments smartly: Focus on sending in your best-selling products first.
- Monitor your IPI score: Regularly check your performance and address issues that might drag it down.
- Keep stock moving: Don’t let slow-moving products eat up valuable space – consider running promotions or removing excess inventory.
- Leverage third-party storage: Use a 3PL (third-party logistics provider) to store extra inventory and replenish Amazon only as needed.
FBA capacity limits might feel like a roadblock at first, but really, they’re about balance. Amazon wants to ensure their fulfillment centers run efficiently while giving sellers room to grow. By checking your dashboard often, keeping an eye on your IPI score, and planning your inventory wisely, you can navigate these limits without slowing down your sales.
Think of it this way: limits don’t have to hold you back, they can actually help you streamline your business and run a leaner, smarter operation.
If your brand struggles with Amazon, let us know. Our experts can help your team get on the right track.