Key takeaways: Overstock shows in three reports before it shows in fees: the Inventory Performance dashboard, the FBA Inventory Age report and the Manage Excess Inventory page. Act at 120 days of cover, not when the surcharge arrives. The tools are price, ads, bundles, removal and, in the right cases, letting Amazon liquidate. The goal is 60 to 90 days of cover per ASIN.
What overstock actually costs
Amazon charges for the space your inventory takes up every month, with higher rates in the fourth quarter, and adds aged-inventory surcharges on units that have sat in a fulfillment center beyond thresholds Amazon publishes, which start well before a year. The exact rates and thresholds change; check the current fee schedule in Seller Central rather than relying on last year's numbers. Beyond the direct fees, excess stock ties up cash that could buy the next product or fund advertising, and it drags your Inventory Performance Index down, which can cap how much you are allowed to send in for every ASIN, including the ones that are selling well. That last cost is the one sellers notice too late.
The three reports to read monthly
Inventory Performance dashboard. The IPI score and its four components: excess inventory percentage, sell-through rate, stranded inventory percentage and in-stock rate. Amazon publishes the threshold below which capacity limits apply. Read the excess and sell-through components; those are the ones overstock moves.
FBA Inventory Age report. Units by age band per ASIN, with an estimate of the aged-inventory surcharge due. Sort by the oldest bands. Anything approaching a surcharge threshold with more than a few weeks of cover behind it needs a decision now.
Manage Excess Inventory. Amazon's own view of which ASINs have more stock than it expects to sell, with its recommended actions. Its forecast is trailing and does not know your plans, but the list is a good starting point, and the same page lets you create removal orders and set up liquidation.
The decision at 120 days
Read this flowchart as text
- ASIN above 120 days of cover or approaching an age band
- Does the ASIN still have a margin at a lower price?
- Price test or coupon, lift ad support, read 2 weeks
- Velocity up enough to reach 90 days of cover in time?
- Hold, recheck monthly
- Bundle or multipack; outlet or deal
- Removal cost below surcharge plus storage?
- Removal order to your own warehouse or 3PL
- Liquidation through Amazon; write down the stock
- 60-90 days of cover, IPI above threshold
The trigger is 120 days of cover on any ASIN, or any units within two months of an aged-inventory band. At that point the question is whether the product can still be sold at a profit if it is sold faster, and the answer decides which tool to use.
Sell it faster
If the margin allows, lower the price or run a coupon, and raise ad support on the terms where the ASIN converts. A price cut that increases velocity enough to bring cover back inside 90 days before the surcharge date is nearly always cheaper than the surcharge plus the extra months of storage. Run it as a test for two weeks and measure profit per visitor, not just units, because a discount that clears stock at a loss has only moved the problem to the P&L. The pricing method is E9 · How we test prices. Deals and outlet promotions on the Manage Excess Inventory page reach shoppers specifically looking for discounts and can move slow stock in a week.
Change the offer
A slow single unit is sometimes a fast multipack. Bundling the slow ASIN with a strong seller, or creating a two- or three-pack, changes the price comparison on the results page and raises order value at the same time; that is the lever in D24 · Low average order value (AOV). Variations that are slow because they are hidden in a large family can be helped by making them visible in the gallery and A+ comparison chart.
Remove it
If the product will not sell at any price you can accept, compare the cost of a removal order to your own warehouse or a 3PL against the surcharge and the storage you would otherwise pay. Removal is usually the right call for stock you can sell elsewhere, repackage or hold for a season. Create the removal before the surcharge date, and allow several weeks for Amazon to process it in busy periods.
Let Amazon liquidate
For stock with no other outlet, Amazon's liquidation program recovers a fraction of the value and stops the fees. It is a write-down, and it should be treated as one in your accounts, but a fraction recovered beats paying to store something that will never sell.
Preventing it
Overstock is nearly always a forecast that was too optimistic: a launch order sized for a best case, a peak order that assumed last year's uplift on a product that had since lost rank, or a variation ordered in the same quantity as its siblings. The weekly days-of-cover check, ordering to 60 to 90 days at a forecast rate, and a flag at 120 days catch most of it before it becomes a fee. That routine is the same one that prevents stock-outs; the two problems are the two ends of the same forecast.
Peak stock is the special case. Order enough for the event plus two weeks, not for a guess at the whole quarter, and have the clearance plan ready for the week after the event, when demand drops faster than most sellers expect. The seasonal calendar covers the timing.
D14Too much stockinventory back to 60–90 days of cover before long-term storage fees bite.
Frequently asked questions
What is a good IPI score on Amazon?
Above the threshold Amazon currently publishes for avoiding capacity limits, with a margin. The threshold has changed over time, so check the Inventory Performance dashboard for the current figure. Above it, focus on the excess and sell-through components rather than the score itself.
When do Amazon aged-inventory surcharges apply?
On units that have been in fulfillment centers beyond age thresholds Amazon sets, with the rate rising as stock gets older. The thresholds and rates change; the FBA Inventory Age report shows the estimated surcharge for your stock and the dates it will apply.
Should I lower my price or create a removal order for excess stock?
Lower the price first if the product still has a margin at the lower price and the extra velocity will bring cover under 90 days before the surcharge date. Remove it if it will not sell at an acceptable price and the removal cost is below the fees you would otherwise pay.