Introduction
For many Amazon sellers, inventory feels like a constant balancing act. Run out of stock, and your ranking crashes. Hold too much, and you drown in storage fees. But with Amazon’s increasing focus on efficiency—through IPI scores, restock limits, and new surcharges—inventory planning has become one of the most critical skills for long-term profitability.
This guide breaks down how to master inventory planning to scale smart, not just fast.
Why Inventory Planning Matters
- Buy Box Impact: Amazon’s algorithm favors sellers who can consistently meet demand. Stockouts hurt both sales and organic rank.
- Cost Control: Excess inventory leads to storage fees, aged-inventory surcharges, and reduced cash flow.
- IPI Score: A strong Inventory Performance Index gives you more storage space and flexibility. Poor scores can strangle growth.
- Cash Flow Health: Inventory is often the biggest capital expense for Amazon sellers—managing it well is managing your business well.
Key Principles of Amazon Inventory Planning
- Forecasting Demand Accurately
- Use 30/60/90-day velocity data.
- Account for seasonality, promotions, and external traffic pushes.
- Blend historical data with forward-looking trends.
- Avoiding Stockouts
- Set safety stock thresholds based on lead times.
- Split purchase orders into smaller, frequent shipments.
- Adjust ad spend when inventory dips below critical levels.
- Managing Overstock
- Watch Amazon’s aged inventory reports.
- Use removal orders before surcharge deadlines.
- Price strategically to move stale stock before penalties.
- Optimizing IPI Score
- Fix stranded listings quickly.
- Keep sell-through rates strong with price + ad adjustments.
- Remove or liquidate slow movers dragging your score down.
Tools for Smarter Inventory Planning
- Amazon’s Restock Reports: Good baseline, but often lagging.
- Forecasting Tools (Helium 10, SoStocked, InventoryLab): Layer data-driven accuracy on top of Amazon’s.
- Custom Dashboards: Track TACoS, sell-through, and velocity together for holistic planning.
Common Mistakes Sellers Make
- Only planning by gut feel instead of data-driven forecasts.
- Ignoring lead times when placing POs, resulting in chronic stockouts.
- Over-ordering “just in case” and getting trapped with storage fees.
- Not monitoring IPI score until it’s too late.
Real-World Example
A beauty brand constantly ran into stockouts during promotions. By switching to a rolling forecast model (blending historical data with upcoming campaign schedules) and splitting shipments, they cut stockouts by 60%. Their IPI score improved, storage limits increased, and total sales rose 25% in 90 days.
Advanced Strategies
- Dynamic Replenishment: Adjust POs weekly instead of quarterly.
- Regional Inventory Planning: Align shipments closer to demand regions to cut inbound placement fees.
- Advertising + Inventory Sync: Dial up ads when stock is healthy; throttle when safety stock is at risk.
- Multi-Channel Buffering: Use FBM or 3PLs as a backup channel to prevent total stockouts.
Conclusion
Inventory planning isn’t glamorous—but it’s the backbone of sustainable Amazon growth. By mastering demand forecasting, balancing stock, and protecting your IPI score, you can avoid costly mistakes, reduce fees, and scale with confidence.
The bottom line: Smart inventory planning = more sales, lower costs, healthier margins.
