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Fulfillment by Amazon is a unique, beneficial feature of Amazon that allows sellers to have their goods stored, packed, and shipped and be freed from a number of difficulties that the management of selling products online entails. FBA provides marketers with a range of benefits and opportunities that facilitate merchandising online goods. As every convenient and loyal program offered by ecommerce platforms such as Amazon, FBA is embraced in several rules and principles that sellers have to stick to. Yes, Amazon provides sellers with the fees for the return and disposal of FBA inventory, which comes with reasonable fees and is affordable to sellers.
Now, let’s take a closer look at FBA removal fees and the fees sellers have to pay for other options connected with Amazon FBA.
What are Amazon FBA Removal Fees?
Amazon FBA removal fees are charges incurred when you request Amazon to return your inventory from their fulfillment centers or dispose of it on your behalf. These fees apply to various scenarios such as overstocked items, seasonal products that didn’t sell as expected, or aged inventory subject to long-term storage fees.
Why Do Removal Fees Exist?
Removal fees exist primarily as a mechanism to encourage sellers to manage their inventory efficiently. Amazon’s fulfillment centers are designed for fast-moving products, and stagnant inventory takes up valuable space. By imposing removal fees, Amazon ensures that only active, selling products occupy their warehouse shelves, optimizing space and logistics for everyone involved.
How to Calculate Removal Fees
Calculating Amazon FBA removal fees is straightforward but essential for financial planning. The fees are typically based on the size and weight of the items being removed. Amazon categorizes items into standard size and oversize, with varying rates for each category. You can find the most current fee schedule in Seller Central under the “Fulfillment by Amazon” section.
Generally, fees are calculated as follows:
- Standard-Size Items: Fees can range from $0.25 to $0.55 per unit, depending on weight.
- Oversize Items: Fees generally start at $0.60 per unit and can go up to several dollars, depending on the dimensions and weight of the item.
How to Remove Inventory From Amazon FBA
Removing inventory from Amazon FBA is a pretty simple process requiring you to take several important steps and pay a small fee. Here’s a small guide to how you can remove items from FBA:
Create a removal order
With Amazon, you are free to choose from two options of removing order from FBA. Using the first option, you should visit the Manage Inventory page and remove items from any listing available. Another option you can stick to is choosing the items you want to remove manually on the same Manage Inventory page. Here, you have to pick the “Action” option and then click “Create Removal Order.”
Add address and order ID
When choosing the return option, you have to indicate the shipping address. Along with the address, you need to include order ID. Once you choose not to provide an order ID, it will be generated automatically.
Specify the SKUs/units you ordered
To include more items in the list, you need to seek the product with the help of its ASIN, FNSKU, or MSKU. All you need to do is provide these details to the box named “Search and Add Items” and choose search. Pick the products you want to remove and choose the button called “Add Selected.”
Add the items to be removed
Indicate the number of goods you want to remove from FBA. The number can’t exceed the quantity that’s available to be removed.
Review the order with the goods to be removed
After you provide that number of products you want to remove, you have to review the Amazon removal order, checking all details provided. Be sure to check if the order ID, the removal method, the details of items chosen for removal, and the ship-to address.
The Types of Amazon Removal Fees
There are several types of Amazon FBA removal fees:
- Standard Seller Fees: the fees vary from about 15-18% of the price after the item is sold.
- Fulfillment Fees: the fees are imposed per unit, they may vary based on whether or not the product is of standard size or non-standard size. These fees include picking, shipping, packing, and handling, customer services, and the returns of products.
- Inventory storage fees: are based on the month and an average volume of the storage. Business owners are normally charged with storage fees per month. The fees can also vary depending on product size and apply to the units stored in the Amazon fulfillment center for more than 365 days.
- International fees: Amazon offers Global Export, which provides sellers with an opportunity to send inventory across the world.
How to Cancel a Removal Order
It’s possible to cancel a removal order providing the status is “Pending” or “Planning.” If the order has the “Processing” status and can’t be cancelled by the seller. Cancelling a removal order is quite a common practice followed by Amazon sellers. The steps you need to take for cancelling the order:
- On the “Manage the Order” page, choose the option called “Advanced Search;”
- In the drop-down list, pick “Order ID;”
- In the order ID section, click the “Search” button;
- Under the “Action” button, choose the option “Cancel the Order.”
Transactions of Removal Order
Amazon sellers are imposed with a fee once the order has been removed. Thus, a removal transaction emerges in the seller’s Payment report. This is how you need to find a transaction:
- Open the tab called “Transaction View” in the section “Payments.”
- Choose the “Services fees”, which you can find in the drop-down menu.
- Choose the date range you can find in the “Within” menu.
- Choose the “Update” button.
- Choose the “Product details,” pick transactions with the “FBA Removal Order” label. On the page, you will see the date of processing the order.
Minimizing Removal Fees
While removal fees can feel like an unavoidable aspect of selling on Amazon, several strategies can help you reduce these costs. Here are some effective tips:
- Monitor Inventory Levels: Regular inventory checks can prevent overstocking and decrease the need for removals. Implementing an inventory management system provides real-time data, enabling you to make informed decisions about stock levels.
- Adjust Replenishment Strategies: By analyzing sales data and fine-tuning your replenishment strategies, you can avoid stocking products that aren’t performing well. Forecasting tools and sales analytics offer insights into trends and consumer behavior, allowing you to adjust orders accordingly.
- Offer Discounts or Promotions: For slow-moving items, consider offering discounts or promotions to boost sales velocity and avoid removal fees. Flash sales, seasonal discounts, and bundled offers can attract customers and help clear out stagnant inventory.
- Strategize Seasonal Products: Seasonal items have a limited sales window, so planning accordingly is vital to avoid excess inventory. Conduct market research and align your inventory with seasonal demand to ensure you have the right stock at the right time, reducing overstock risk.
- Optimize Product Listings: Enhance your product listings to improve visibility and boost sales, reducing the likelihood of removals due to slow sales. High-quality images, detailed descriptions, relevant keywords, and positive reviews can increase your product’s appeal and search rankings.
By implementing these strategies, you can effectively manage inventory, improve sales performance, and minimize the impact of removal fees on your business. Staying proactive and informed will help you navigate the challenges of selling on Amazon more efficiently.
