Amazon Inbound Placement Fees

Amazon is focusing on fast and free shipping by placing inventory in multiple fulfillment centers across the US and introducing the FBA inbound placement service, which applies to standard and large bulky-sized products starting March 1, 2024.



Amazon introduced new inbound placement fees for FBA inventory on March 1, 2024, covering the cost of splitting and sending inbound inventory to multiple locations for fast delivery. The fee ranges from $0.21-$0.68 per item for standard items to $0-$3.32 per large, bulky unit sent to two to four locations. This has angered sellers and the Federal Trade Commission, who previously used tools to create multiple inbound shipping plans. Amazon has now charged an additional "abandoned shipment" fee.

What Is Amazon FBA Inbound Placement Service Fees

Amazon made the calculated choice to split seller inventory over several fulfillment centers to guarantee that customers receive their orders quickly. Although this service reduces delivery times and increases customer happiness, it comes at an additional cost to sellers, which is included in the FBA Inbound Placement Service Fee. This fee is charged 45 days after Amazon receives your shipment and applies to both regular and large bulky-sized products.

Latest Amazon Fee Adjustments

The FBA inbound placement service fee, introduced on March 1, 2024, costs Amazon to distribute inventory across its fulfillment centers near customers. This method ensures fast order shipping and faster product delivery. The fee is charged 45 days after shipment receipt, depending on the location and quantity received. Amazon’s inventory placement fees for 2024 are:

Inventory Placement Charges

The average placement fee for standard-sized products is $0.27, while for large bulky items, it's $1.58. Costs vary based on item type and shipping region split.

Reduction In FBA Fees Across Most Items

Amazon provides an average discount of $0.20 on most items, but this does not include new placement fees.

Amazon's Fees For Low Inventory

Amazon has reduced non-peak storage costs by $0.09 per cubic foot to encourage inventory increases, with fees for products with less than 28 days of stock varying.

Abandoned Shipping Plans

Amazon will charge sellers a fee for abandoned shipping plans starting April 15, 2024, due to third-party software generating and splitting shipping plans until no fee-free options are found.

Inbound Placement Option 

Sellers are facing mixed opinions on inbound placement fees, which require juggling inventory and shipment, especially for vendors importing directly from China. Some report astronomically high fees, such as $300 placement fees compared to $122 delivery fees. As of April 15, sellers no longer have the option to generate shipping plans with no fees, as they will pay a fee for deleted and abandoned shipments.

Shipment Splits

Choose a minimal number of fulfillment centers for Amazon distribution, incurring an additional per-item fee, especially higher in the Western U.S.

Amazon-Optimized Shipment Splits

By shipping to two or three recommended fulfillment centers or distributing to numerous centers, sellers can send inventory directly to multiple fulfillment centers, potentially cutting or avoiding expenses.

Amazon's Inbound Placement Service Fee Calculation

To reduce the inbound placement service fee on Amazon FBA, consider minimizing fees under new inventory placement fees for 2024, shipping more inventory at once, and taking advantage of the Ships in Product Packaging (SIPP) program. Optimize shipping plans to maintain profitability, such as selecting "Amazon Optimized Shipment Splits" for every order and having four to five boxes with every inbound shipment. Create separate shipments for standard-sized, non-standard items, and special handling categories, and ensure item mix and quantities are evenly split across boxes.

Amazon Shipment Splits

Amazon offers a free option to send inventory to at least 4 designated fulfillment centers, which can be cost-effective if your shipping plan qualifies, allowing Amazon to distribute products further within their network.

Analyze Item Dimension

The fee is based on item size and weight categories, with the potential for lower fees if smaller items are consolidated into larger packages. Assessing packaging size and weight without compromising integrity.

Plan Inventory Strategically

Amazon's inbound placement service fees can be higher, especially in the West. To estimate costs, use the Amazon Revenue Calculator. Larger quantities of inventory can qualify for lower fees, but balance with storage costs and stock levels. Consider alternative fulfillment options if fees are a concern.

Understanding Your Inbound Placement Service Fees 

Amazon has enhanced the Revenue Calculator by offering inbound placement service fee options for calculating per-unit rates for single SKUs and bulk quantities.


The estimated inbound placement service fee for each shipment can be found in the estimated fees section on your Shipment summary page. The FBA inbound placement service fee report calculates fees for total and SKU shipments, identifies compliant shipping plans, and identifies inbound defects within 24 hours of shipment charges.

Finding Your FBA Inbound Placement Fee Report

  • Choose Fulfillment from the Reports drop-down menu.

  • Scroll down to Payments on the left side of the website and select FBA inbound placement service fee.


Strategies To Reduce FBA Inbound Placement Service Fee

New inventory placement fees for 2024 reduce fees by requiring more inventory shipping and utilizing the Ships in Product Packaging program for discounts ranging from $0.04 to $1.32.

Utilize Amazon-optimized shipment splits, and partial splits, and optimize item size and weight to reduce fees. Balance larger shipments against storage costs and strategically plan inventory levels for fee savings.

Categorize Your Shipments

Amazon's new FBA inbound placement service fee structure requires shipments to be categorized based on item size and special handling requirements. Combining standard-size items with non-standard-size or special handling items in a single shipping plan requires inventory allocation across multiple inbound locations. To avoid complications and costs, large items, dangerous goods, and specific categories should be grouped into separate shipments.

Size And Potential Fee Of Your Item

Under 2024 FBA inbound placement service fee guidelines, improve your sourcing strategy by considering item size and associated fees. Use the Amazon Seller app to factor in fees and assess profitability. Adjust the "Inventory Placement" option to include the inbound placement service fee in the cost analysis.


Amazon is set to implement fee changes in 2024 to provide value and reduce costs for sellers. Amazon's inbound placement service fee is causing increased inventory costs for sellers. Accurately calculating options is crucial for FBA inventory costs. Amazon eliminates multiple shipment plans, leading to higher shipping expenses. Careful inventory management and planning for shipping to multiple locations can minimize costs and fees.

Comments

Post a Comment

Popular posts from this blog

The Essential Role of Cargo Shipping

Image
In the vast expanse of global trade, one silent hero stands tall: cargo shipping. From the bustling ports of Shanghai to the harbors of Rotterdam, cargo ships ply the world's oceans, connecting nations and facilitating the movement of goods on an unprecedented scale. Economic Efficiency and Environmental Impact Cargo shipping reigns supreme as the most cost-effective mode of transportation per ton. Unlike its counterparts on land and in the air, shipping offers unparalleled affordability, making it the preferred choice for businesses worldwide. Moreover, its relatively low environmental impact compared to other modes of transport underscores its sustainability credentials, aligning with the growing focus on eco-friendly practices in the modern era. Capacity and Infrastructure What sets cargo shipping apart is its remarkable capacity to transport bulky cargo that defies conventional modes of transportation. Equipped with state-of-the-art loading and unloading facilities, cargo ships...
Read more

Amazon's New Returns Processing Fee for Sellers

Image
Amazon, the e-commerce giant, is set to implement a significant change for sellers with the introduction of a "Returns Processing Fee" starting June 1st, 2024. This fee will impact all product categories except clothing and shoes, aiming to address operational costs related to returns and reduce waste. While the exact thresholds triggering the fee for each category are yet to be disclosed by Amazon, sellers are advised to stay informed and adapt their strategies accordingly. Key Changes and Implications Fee Exemptions : Products with less than 25 units shipped in a month will be exempt from the fee for those units. Additionally, new products enrolled in the FBA New Selection program will receive a fee waiver for up to 20 units, providing some relief for sellers. Return Window:  Sellers will have 180 days for returned products to reach an Amazon fulfillment center, allowing for a reasonable timeframe for managing returns efficiently. Calculation Basis: The fee will be based on...
Read more

How Lean Management Transforms Logistics Efficiency.

Image
Lean management is a game-changing approach that can significantly improve efficiency in logistics. By focusing on reducing waste and optimizing processes, companies can ensure a smoother, more effective flow of goods, ultimately leading to better performance and higher customer satisfaction. What is Lean Management? Lean management is a methodology that aims to maximize value for customers while using fewer resources. Originating from the Toyota Production System, lean management has been widely adopted across various industries to streamline operations and reduce waste. How Lean Management Enhances Logistics 1. Eliminates Waste: Lean management focuses on identifying and removing waste in all forms—whether it's excess inventory, unnecessary movement, or redundant tasks. Reducing waste lowers costs and boosts efficiency. 2. Optimizes Processes: Lean techniques streamline processes, enhancing both speed and quality. By mapping out current workflows and pinpointing bottlenecks, comp...
Read more