What Is Amazon IPI Score (and Why It Matters)

What is IPI?

The Inventory Performance Index (IPI) is Amazon's proprietary score that measures how efficiently you manage your FBA inventory. Think of it as a credit score for your warehouse management — it determines how much storage space Amazon will allocate to your account.

Amazon introduced IPI in 2018 to incentivize sellers to maintain lean, well-managed inventory. Before IPI, sellers could hoard unlimited warehouse space with slow-moving products, creating capacity problems across the FBA network. Now, your storage allocation is directly tied to how well you manage what you already have in Amazon's warehouses.

The score ranges from 0 to 1000, with higher scores indicating better inventory management. Most sellers fall between 300 and 800. The critical threshold — the number that determines whether you face storage restrictions — is currently 400 (though Amazon has adjusted this in the past).

How the score is calculated

Amazon doesn't publish the exact IPI formula, but we know it's a weighted combination of four inventory health metrics. Based on seller data analysis and Amazon's own guidance, here's what we understand about the weighting:

The score uses rolling data — typically a 90-day window for sell-through and excess calculations. This means improvements take time to reflect, usually 2-4 weeks before you see meaningful score changes after taking corrective action.

Importantly, IPI is calculated at the account level, not per ASIN. One product with massive excess inventory can drag your entire account's score down, even if everything else is perfectly managed.

The four factors in detail

1. Excess inventory percentage

This measures what percentage of your FBA inventory Amazon considers "excess" — products with more than 90 days of supply based on current sales velocity. Amazon calculates this by comparing your current inventory level against your forecasted demand.

Products get flagged as excess when:

• Supply exceeds 90 days: If you're selling 10 units/day and have 1,500 units in stock, that's 150 days of supply — clearly excess.
• No sales in 90+ days: Dead inventory with zero velocity is the worst offender.
• Seasonal products out of season: Christmas items sitting in FBA in March are eating your IPI alive.

This is typically the highest-weighted factor and the one most sellers struggle with. The fix: run promotions on excess stock, create removal orders for dead inventory, and use the data-driven restock formulas to avoid over-ordering in the first place.

2. Sell-through rate

Sell-through rate measures how quickly your inventory moves. Amazon calculates it as: units sold and shipped over the last 90 days divided by the average number of units in stock during that period.

A healthy sell-through rate is above 3.0, meaning you're turning your inventory more than 3 times per quarter. Below 2.0 signals a problem — either you're over-stocked or your products aren't selling fast enough.

Improving sell-through requires either selling more (better PPC campaigns, listing optimization, pricing adjustments) or reducing the denominator by removing excess stock.

3. Stranded inventory percentage

Stranded inventory is stock sitting in FBA warehouses without an active listing. It's the easiest factor to fix — and often the most costly to ignore. You're paying full storage fees on products that literally cannot sell.

Common causes of stranded inventory:

• Listing closed due to pricing error or policy violation
• Listing suppressed for image or content compliance issues
• Listing accidentally deleted
• Inventory received before listing was created
• ASIN restricted by Amazon

Check stranded inventory weekly — or better yet, set up automated monitoring. For a detailed walkthrough, see our guide to fixing stranded inventory.

4. In-stock rate

This measures how often your replenishable FBA products are in stock. Amazon calculates it based on the percentage of time your top products have been available for purchase over the last 30 days.

Note: Amazon only counts products it considers "replenishable" — those with consistent sales history. One-time or seasonal products typically don't factor into this metric.

Maintaining a high in-stock rate requires accurate demand forecasting and timely reorder triggers. Stockouts on your best sellers are doubly painful: you lose sales AND your IPI drops.

Score thresholds and what they mean

The 400 threshold is the critical line. Dropping below it triggers storage volume limits for the following quarter. During peak season (Q4), this can be devastating — you literally cannot send in enough inventory to meet demand.

How IPI affects storage limits

Amazon evaluates your IPI score at the end of each quarter to set storage limits for the following quarter. If your score is below the threshold at the evaluation date, you receive a storage volume limit measured in cubic feet.

The practical impact:

• Cannot create new shipments if you're at or above your storage limit
• Overage fees of $10 per cubic foot per month if you exceed your limit
• Forced prioritization — you must choose which products to stock, often leaving your best sellers under-stocked

This creates a vicious cycle: limited storage → stockouts on winners → lost sales → lower sell-through → lower IPI → even lower storage limits next quarter. Breaking this cycle requires aggressive excess inventory management.

How to check your IPI score

In Seller Central, navigate to Inventory → Inventory Planning → Performance tab. Your current IPI score is displayed prominently at the top, along with a breakdown of each factor's contribution.

Key pages to bookmark:

• Inventory Performance Dashboard: Overview of your IPI and factor breakdown
• Manage Excess Inventory: Shows every ASIN Amazon considers excess, with recommended actions
• Fix Stranded Inventory: Lists all stranded ASINs with fix instructions
• Restock Inventory: Amazon's restock recommendations for in-stock rate optimization
• Inventory Age: Shows units approaching aged inventory surcharge thresholds

Strategies to improve each factor

Reducing excess inventory (biggest impact)

• Run promotions: Coupons (20-30% off), Lightning Deals, and Prime Exclusive Discounts move excess stock fast
• Price reductions: Even a 10-15% price cut can dramatically improve sell-through on stale inventory
• Create removal orders: For truly dead stock, pay the $0.50-1.00/unit removal fee rather than $6.90+/cubic foot in aged surcharges
• Liquidation program: Amazon sells your inventory at a deep discount and you receive a portion — better than paying to remove it
• Bundle slow movers: Pair slow-selling products with popular ones in a new bundle listing

Improving sell-through rate

• Optimize listings: Better titles, images, and A+ Content increase conversion rates
• Increase PPC spend: More traffic × same conversion rate = more sales
• Right-size inventory: Send 30-60 days of supply instead of 90+ days
• Seasonal planning: Remove seasonal inventory before it becomes excess

Eliminating stranded inventory

• Weekly checks: Make "Fix Stranded Inventory" a weekly task
• Automated alerts: Set up notifications for listing health changes
• Pre-check listings: Ensure compliance before shipping inventory to FBA
• Relist immediately: When a listing is closed, fix the issue within 24 hours

Maximizing in-stock rate

• Reorder triggers: Set reorder points at 21-30 days of supply (accounting for lead time)
• Safety stock: Maintain a buffer of 7-14 days above your reorder point
• Supplier reliability: Work with suppliers who deliver consistently on time
• Monitor velocity changes: Seasonal spikes require adjusted reorder triggers

Common IPI mistakes

Mistake 1: Ignoring IPI until it's too late. By the time you hit the quarterly evaluation date with a low score, it's too late to fix it for that quarter. Monitor weekly and start corrective action as soon as you see a downward trend.

Mistake 2: Over-ordering "just in case." Sending 120 days of supply to avoid stockouts seems safe, but excess inventory is the #1 IPI killer. Use data-driven restock quantities: 30-60 days of supply, replenished frequently.

Mistake 3: Ignoring aged inventory. Inventory approaching 181 days costs you twice — it drags down your IPI AND triggers aged inventory surcharges. Clear it before the threshold.

Mistake 4: Not accounting for FBA processing time. If it takes 2 weeks for Amazon to receive and process your shipment, your reorder point needs to include that lead time. Running out while waiting for processing tanks your in-stock rate.

Mistake 5: Treating all products equally. Focus your IPI improvement efforts on your highest-volume ASINs. They have the most impact on your overall score.

Ongoing monitoring and automation

Managing IPI manually across a catalog of 50+ ASINs is time-consuming. Here's a practical monitoring cadence:

The best approach is to automate as much of this as possible. Tools like Jarvio can monitor your IPI factors continuously, alert you to stranded inventory within hours, and flag excess inventory before it becomes a problem.