Amazon FBA storage fees are the costs that occur when sellers use Amazon warehouses to store their inventory. If you don’t have a space to store your products, you can store them at Amazon warehouses using aFulfillment by Amazon (FBA)service.
When you use this service, you have to pay different types of short-term and long-term storage fees.
In this post, you will find Amazon storage fees explained and tips to avoid long-term storage fees.
Related: How Does Amazon FBA Work. Is Amazon FBA worth it in 2022?
FBA vs FBM: Which is Better for Amazon Sellers?
What Are Amazon FBA Storage Fees?
If you store your inventory in Amazon warehouses and use the Fulfillment by Amazon (FBA) service, Amazon will charge you storage fees.
There are two types of storage fees: Amazon FBA monthly storage fees (short-term fees) and long-term storage fees. The majority of storage fees are charged to your Amazon seller account monthly, typically between the 7th and 15th day of the month, in the month following when the fees were incurred.
Amazon calculates storage fees based on the daily average volume of the space your inventory occupies in fulfillment centers. Rate is based on product type, size-tier, and time of year. From time to time, Amazon updates storage fees. The latest change to Amazon storage fees occurred in 2024.
%20(1).webp "Amazon FBA Storage Fees Explained - Seller Assistant App Blog (2)")
Note. Amazon applies FIFO (First in, First out) accounting method when calculating storage fees. FIFO means units sold or removed are deducted from your inventory stored in Amazon warehouses for the longest time.
Monthly inventory FBA storage fees
Storing your products in Amazon's warehouses costs money each month. The price depends on how much space they take up (average daily volume in cubic feet). The units must be packaged according to Amazon's rules. There are two parts to this monthly fee.
Monthly inventory storage fee components
- Basic storage fee;
- Storage utilization surcharge.
Picture is taken from https://sellercentral.amazon.com/help/hub/reference/G3EDYEF6KUCFQTNM
Monthly Storage Fee report
You can check your monthly storage fees in the Monthly Storage Fee report in your Amazon Seller Central.
To get a report on your monthly storage fees, select a month you want to review and download your fees in .csv or .txt format.
Basic storage fees
This fee depends on your product's size and the time of year. The fees differ from January–September (off-peak fees), and October–December (peak fees). The storage fees for dangerous goods are more expensive.
In 2024 Amazon introduces new basic storage fees. Starting April 2024, Amazon will be lowering storage fees during off-peak months (January to September) by $0.09 per cubic foot. This discount won't show up until your May bill, which covers storage costs for April. Fees for large bulky (oversize) items and peak season storage will remain the same.
Basic storage fees before April 1, 2024
Basic storage fees after April 1, 2024
Storage utilization surcharge
Storage utilization surcharge fee is optional. This extra fee depends on your product's size and how full Amazon's warehouses are. Basically, this surcharge applies to experienced sellers with a lot of standard-sized inventory taking up space during peak times. As it only applies to some sellers, check if you qualify.
Sellers subject to a storage utilization surcharge
- Sellers on Professional account;
- Sellers with their first shipment 365 days ago;
- Sellers with an average daily inventory volume for the product size tier of more than 25 cubic feet;
- Sellers with a storage utilization ratio above 26 weeks (22 weeks from April 1, 2024).
Values used to calculate storage utilization surcharge
- Product size tier;
- Current month;
- Product dimensions and volume (longest side x median side x shortest side);
- Average monthly units stored in FBA minus average pending removals;
- Storage utilization ratio;
- If the product belongs to the Dangerous goods category.
What is the storage utilization ratio?
The storage utilization ratio is the average daily amount of inventory you store divided by the average daily shipped amount over the past 13 weeks. This ratio on the last day of each month is used to determine the monthly storage utilization surcharge.
The storage utilization ratio is calculated for each product size tier independently. You can find your latest storage utilization ratio on the FBA dashboard.
Storage utilization surcharge 2024
From April 1st, 2024, Amazon changes storage utilization surcharges. The surcharge will apply to Professional sellers whose average inventory storage time exceeds 22 weeks. Items in stock for less than a month (between 0 and 30 days) will be exempt from the surcharge.
Starting June 1st, 2024 products automatically restocked by Amazon warehouses will be eligible for a storage utilization surcharge exemption.
Picture is taken from https://sellercentral.amazon.com/help/hub/reference/GJ9NNG7RK4TU6E3Z
Picture is taken from https://sellercentral.amazon.com/help/hub/reference/GJ9NNG7RK4TU6E3Z
Amazon Aged Inventory Surcharge
If your inventory remains in Amazon’s fulfillment centers for more than 180 days, you will pay a long-term storage fee — Aged inventory surcharge (previously known as the long-term storage fee). A fee is applied to inventory stored for more than six months (181 days or more).
The fee is based on a snapshot of your inventory taken on the 15th of each month. It's an additional charge on top of your regular monthly inventory storage fee. It is charged between the 18th and 22nd day of each month.
Amazon Aged inventory surcharge 2024
From February 15, 2024, the aged inventory surcharge for the units remaining in Amazon’s fulfillment centers between 271 to 365 days will increase. The fees for inventory stored between 181 to 270 days, and 365 days or more, will not change.
Aged Inventory Surcharge report
If you have aged inventory, you can find it in the Aged Inventory Surcharge report in your Seller Central. This report shows per-item aged inventory fee charges and allows you to identify which products were charged the aged inventory surcharge and the amounts charged.
To calculate your inventory aged inventory surcharge, enter the period you want to review and click “Generate report”.
How to Avoid Long-term Storage Fees?
To avoid long-term storage fees, you need to manage your inventory effectively and timely remove it from Amazon warehouses if it stays there for a long time.
Ship inventory back
If you detect products staying in Amazon fulfillment centers long-term, you can just ship that inventory back to you. This way, you will avoid continuously piling monthly long-term storage fees, which are pretty expensive.
Use discounts and promos to move inventory out
One of the best and most cost-effective solutions to avoid storage fees is to sell products at a discount. This way, you will not need to spend money on shipping it back or disposing of it in Amazon fulfillment centers, which entails a fee.
Also, you can use promotions or other marketing tools to get your products going.
Proactively manage your inventory
If you sell items in substantial quantities, don’t send all of them at once to the fulfillment centers. Develop a timeline for how long it takes to cycle through your inventory. Keep track of the inventory that doesn’t sell, find out why, and get rid of such items in your store.
Inventory Storage Overage Fees
If your inventory exceeds your storage limits in any month, you will be charged an inventory storage overage fee in addition to monthly inventory storage fees and, if applicable, long-term storage fees.
The overage fee is based on how many days your storage limits are exceeded. This charge will occur even if your inventory is subsequently reduced to a level below your storage limits for a specific month.
The overage fee is charged monthly at $10 per cubic foot based on the daily average volume for any space your inventory occupies in fulfillment centers beyond your storage limits.
Overage fees are charged after the end of the month in which the fees occurred.
Inventory Storage Overage Fees report
You can find your Inventory storage overage fees in the Inventory Storage Overage Fees report. The fees are stated for each storage type and day when your inventory exceeded your storage limits. You can download the report starting the second day of the following month.
FBA product removal, disposal, and liquidation
If your inventory stays in the Amazon fulfillment center for a long time and you want to avoid long-term storage fees, you can ship it back (remove) or have Amazon dispose of your products..
FBA removal orders
If you want to ship your unsold item back to you from Amazon’s fulfillment center, you can ask to remove it. To do that, you can submit a removal order before the Amazon inventory cleanup date (15th of each month).
You can also set up automated removals for inventory subject to long-term storage fees. For that, Amazon charges removal fees.
It can take 90 days or more for a removal order to process and the shipment to leave the fulfillment center, and an additional two weeks for the carrier to deliver the shipment.
FBA disposal orders
If you choose not to remove inventory from a fulfillment center and don’t want to store it on Amazon anymore because of high long-term storage fees, you can dispose of your inventory by submitting a disposal order. For that, Amazon charges disposal fees.
FBA removal and disposal fees 2024
Removal and disposal fees are charged per item removed. They are calculated when you place a removal or disposal order and charged when the shipment goes out from Amazon.
Amazon introduced new FBA removal and disposal fees on February 5, 2024.
FBA liquidations
FBA Liquidations is another option to deal with the inventory that doesn’t sell. With FBA Liquidations, you can sell these items through a third-party liquidator. This lets you recoup some of your original purchase cost and avoid ongoing storage fees and charges for older inventory.
You'll typically see the net recovery value credited to your account within 90 days of submitting your liquidation request.
How to Quickly Calculate Amazon FBA Storage Fees?
Amazon FBA storage fees have a complicated structure and calculating them is challenging. However, you can use Seller Assistant App’s to easily calculate monthly FBA storage fees.
Seller Assistant App is a powerful product sourcing platform that helps easily choose products to sell on Amazon. Seller Assistant App’s shows the cost of monthly storage of goods in Amazon warehouses right on the Amazon product pages. It displays monthly storage costs under “Sto” in the Fees and Logistics Costs panel.
Related: Amazon FBA Calculator: Free vs. Paid
Final Thoughts
One of the advantages of Fulfillment by Amazon is that you can store your inventory in Amazon’s warehouses. However, this involves different types of short-term and long-term storage fees.
To maintain healthy profit margins and ROI, you must thoroughly calculate all costs, including storage fees. Seller Assistant Аpp will help you with that. It combines Side Panel View, , Quick View, ASIN Grabber, IP Alert, Restrictions Checker, in one tool.
Try Seller Assistant Аppnow. Register for our 14-day trial. Grow your Amazon business with confidence.
)
