1.  Check Product Dimensions

Amazon Fulfillment and storage fees are based on product size and weight. Amazon scans your products twice: once when you first create a new ASIN and send it to an FBA warehouse and then sometime after to check if the size remains the same or has changed.

Amazon’s Cubiscan system is not 100 percent perfect, and measurements from one scan to another can get larger results, even while the actual product dimensions do not. There are a number of explanations for this, including operator error and protruding tape that throws the scanner off. Whatever the reasons, Amazon registers the latest scan and changes your product dimensions; Amazon does not inform you of this change, they just assess higher fees based on the larger (incorrect) product dimensions.

Which is why it’s a good practice to regularly check your product dimensions. Go to Amazon Central and run a Fee Preview Report that shows all your FBA inventory fulfillment fees. Compare Amazon’s dimensions and size tiers for all your products to all your product listings.

Report any higher size discrepancies to Seller Support and request rescanning of the products. Correcting the dimensions ensures you are correctly charged lower Amazon FBA fees going forward. In addition, you can file a claim for FBA reimbursement of the higher fees incorrectly charged to you. However, Amazon’s FBA reimbursement policy provides instructions on how to file claims and restrictions on when claims are filed. For overcharged fulfillment fees, a claim must be filed within 90 days. When does the clock start ticking? From the time Amazon makes the incorrect Charge. Which is why you need to do this check regularly (see step 6 below).

2. Put Products in the Correct Size and Weight Band

Amazon fees for FBA fulfillment are charged by product size and variable weight tiers. Standard size is anything that weighs less than three pounds; anything heavier applies a variable weight fee.

For example, a standard product weighing one pound has a $3.48 fulfillment fee, while a product just one ounce heavier is considered a higher band and has a $4.90 fulfillment Amazon fee. That’s $1.42 more; multiply that times hundreds or thousands of products, and that’s a considerable amount of Amazon fees.

This is why you need to look at products at the bottom of each size or weight band. Then think about how you could lighten the product and its packaging. Even an ounce can make a difference. Try to eliminate unnecessary packaging or less bulky packaging to reduce weight. It might take some time to rethink how to repackage and save weight, but it’s time that can easily reduce your Amazon fees and improve your productivity.

3. DIY Preparation

You can let Amazon do all the required packaging and prep work for you. But it’s not a free service. Moreover, if Amazon does all the prep work, you are at the mercy of their turnaround times. Which means inventory may not be available for purchase as quickly as orders are coming in.

Amazon fees can add up to a dollar or even more to prepare, package and label your product. Multiply that Amazon fee times hundreds or thousands of sales. Also keep in mind that during November and December, the Christmas holiday season when sales normally spike, Amazon fees are higher due to anticipated higher volume.

How can you avoid these Amazon fees?

You could do the prep work yourself or hire a third party that specializes in FBA prep work. The first requires a commitment of your time (or an employee’s time) and the second is going to cost you money. However, the time and money you spend is going to save you on Amazon fees, which are higher than what a third party is likely to charge.

You can either complete an online form or upload a file about your box content information. An inventory management system that handles FBA inbound shipping can also provide box content information to Amazon.

4. Eliminate Unfulfilled and Stranded Inventory

Amazon inspects returned products to determine if they can be resold. Products in poor, unsalable condition are classified as “unfillable.” However, unfillable products remain as part of your inventory and are charged a storage fee until they are removed.

Use the Inventory Health report in Seller Central to determine if you have unfillable inventory. You can make it a habit to check for unfillable inventory every week or at least twice a month. There is also an option for automatic inventory removals to either dispose of unfillable stock or return the items to you.

There are also programs that provide a means to resell unfillable inventory as used or to liquidate stock entirely. Again, there are fees for this service, but they cost less than the Amazon fees charged to you for stock that is just sitting in their warehouse for no useful purpose.

Stock that is kept in an Amazon fulfillment center but does not have an active offer is considered stranded inventory. Amazon reports stranded inventory to you. If you do not take action to create a new listing or remove stock, Amazon considers it unsellable and you are required to remove it. Run a stranded inventory report to fix listings or dispose of stock.

5. Minimize Storage Fees

Amazon charges you for storage. Fees vary depending on the season and whether inventory is in a fulfillment center for longer than a year.

The less inventory you have in a fulfillment center, the lower your Amazon fees. If you’ve ordered a lot of stock anticipating sales that don’t pan out, Amazon fees to maintain unsold stock in its fulfillment center can cost you.

Accurate sales forecasting can help avoid this situation, but even the best forecasting is subject to unforeseen events (like the pandemic, for example). It’s a good practice to conduct regular inventory reviews to determine stock that isn’t moving, and in particular stock that is near or exceeded one year long-term storage which incurs heftier Amazon fees. You can markdown slow moving stock, even if at a slight loss, just to get it out of inventory, or in some cases liquidate it (note that there are Amazon fees for removing inventory). In either case, while you are losing profits you hoped to make, you aren’t continuing to lessen profitability due to Amazon fees on inventory you aren’t selling.

You might also want to consider shipping slower-selling items yourself or through a third party logistics company. With Seller Fulfilled Prime you can still retain your Prime badge, even though you aren’t using Amazon fulfillment services. Again, this is not without cost, but the cost is still likely lower than Amazon fees to store your slow-selling inventory.

6. Audit Your Amazon Fees

Amazon processes orders and inventory globally. It’s not surprising that sometimes there are errors in Amazon fees. And that incorrect Amazon fees owed to you aren’t corrected, or even reported to you. These owed reimbursements easily add up over time.

In fact, unrecovered Amazon FBA fee reimbursement can average as much as three percent of your annual revenue. Multiply that by thousands of dollars of sales every year and unpaid reimbursements represent significant lost revenue.

It’s largely left up to you to audit your inventory to determine  if certain Amazon fees are incorrectly assessed, it’s also up to you to submit claims for these owed fees.

A software service designed specifically to track Amazon FBA inventory and reimbursements, combined with a dedicated case manager can help ensure you get the reimbursements you are owed.

GETIDA auditing software keeps track of your Amazon FBA inventory transactions, refunds, seller data analytics, and FBA reimbursements easily and clearly. An easy-to-read dashboard displays robust analytics to help you fully understand what we are doing on a daily basis.

Equally important, dedicated case managers with Amazon experience follow up on FBA reimbursement claims on your behalf. They help ensure you get back what you are owed.

GETIDA makes the process of claiming Amazon fee reimbursement easy. And it’s free, with no commitment. GETIDA charges only when a claim we file is successfully reimbursed.

Why pay for something you shouldn’t have to? Your bottom line performance. Get $400 in Free Amazon Seller Refunds with GETIDA.

For even more information check out our recent blog post that discusses all of the Amazon FBA fees involved in running an Amazon business.