Amazon FBA Storage Fees Explained
Amazon 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 a Fulfillment 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.
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. All 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 2022.
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 Amazon Storage Fees In 2022
If you have inventory in the Amazon warehouse at the end of the month, Amazon implements a monthly storage fee.
The fees differ from January–September, and October–December. In 2022, Amazon introduced new fees.
For standard-sized items during January–September, Amazon charges $0.83 per cubic foot, and in October–December—$2.40 per cubic foot.
For oversized items, from January–September, Amazon charges $0.53 per cubic foot, and from October–December—$1.20 per cubic foot.
The storage fees for dangerous goods are more expensive.
For standard-sized dangerous items during January–September, Amazon charges $0.99 per cubic foot, and in October–December—$3.63 per cubic foot.
For dangerous oversize items, from January–September, Amazon charges $0.78 per cubic foot, and from October–December—$2.43 per cubic foot.
You can use the Amazon storage fees calculator from Seller Assistant App to easily calculate monthly storage fees. It shows the cost of monthly storage of goods in Amazon warehouses right on the Amazon product page. It displays monthly storage costs under “Sto” in the Fees and logistics costs panel.
Amazon Long-term Storage Fees
If your inventory is stored in Amazon fulfillment centers for 271 to 365 days, Amazon charges a surcharge for aged inventory. If it is stored over 365 days, long-term storage fees apply.
Amazon surcharge for aged inventory
On May 15, 2022, Amazon introduced a new surcharge for aged inventory 2022 stored within 271-365 days.
For the inventory stored within 271-365 days, Amazon recently introduced a monthly surcharge—of $1.50 per cubic foot.
Amazon long-term storage fees 2022
If your inventory has been in a fulfillment center for more than 365 days, Amazon will charge a monthly long-term storage fee.
FBA long-term storage fees are $6.90 per cubic foot or $0.15 per unit, whichever amount is greater.
Amazon cleans up inventory on the 15th of each month. During the clean-up, Amazon records all units that have been in their fulfillment centers for 365 days or longer.
If your inventory exceeds your storage limits for a given 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.
Long-term Amazon storage fee report
If you have incurred storage fees, you can find them in the Long-term storage fee report in your Seller Central. This report shows per-item long-term storage fee charges and allows you to identify which products were charged the long-term storage fee and the amounts charged.
To calculate your inventory's total long-term storage fees, download the report and add up the charges in the ‘12-mo-long-term-storage-fee’ column.
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.
Removal Orders and Removal Fees
If your inventory stays in Amazon fulfillment center for a long time and you want to avoid long-term storage fees, you can ship it back.
To do this, 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.
Removal fees are charged per-item removed.
FBA Disposal Orders and Disposal Fees
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.
Disposal fees are charged per item when you request that Amazon dispose of items in your FBA inventory stored at an Amazon fulfillment center.
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 an FBM&FBA profit calculator, IP Alerts, Quick View, Stock Checker, and Restrictions Checker in one tool.
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