How To Manage Unfulfillable Inventory on Amazon: Complete Guide
Unfulfillable inventory on Amazon can pose a real challenge for sellers. This refers to products that cannot be sold due to defects, damage, or other issues, costing you both money and valuable storage space.
As an Amazon seller, understanding how to manage this type of inventory is crucial for selling on the platform effectively.
You may wonder how to identify and address these unfulfillable items in your Seller Central account.
Keep reading to discover practical tips and solutions that can help you regain control over your inventory and improve your business.
What Is Unfulfillable Inventory on Amazon?
Unfulfillable inventory on Amazon refers to items that cannot be sold. This happens after a quality check at an Amazon fulfillment center. When products arrive in a damaged state, or when they do not meet Amazon's selling standards, they are labeled as unfulfillable.
There are several reasons why inventory becomes unfulfillable:
- Damaged Items: Products can get damaged during transit or return processes.
- Expired Goods: Items that have a limited shelf life may become unsellable once they expire.
- Non-compliance: Sometimes, products do not follow Amazon's requirements, making them unfit for sale.
If you use Amazon FBA (Fulfillment by Amazon), you must keep track of both unfulfillable and fulfillable inventory. Unfulfillable inventory can lead to extra storage fees if mixed with items that are sellable.
You can manage unfulfillable inventory through your Amazon Seller Central account. Items that fall into this category can often be refurbished or resold as used, depending on their condition.
By knowing about these processes, you can better handle your products in FBA shipments.
Understanding unfulfillable inventory helps you maintain your business's efficiency and reduces potential losses.
It’s important to monitor inventory closely to keep your sales running smoothly.
Types of Unfulfillable Inventory
Unfulfillable inventory can significantly impact your Amazon sales. Understanding the types helps you manage this issue effectively. Here are the main categories.
Damaged Goods
Damaged goods are a common issue for sellers using Amazon FBA. These items can become unfulfillable due to various reasons. For instance, warehouse damage might occur during storage or handling.
Additionally, products can become carrier-damaged while in transit. If your inventory arrives at an FBA warehouse in poor condition, it typically won’t be available for sale.
You need to stay vigilant about checking your inventory upon delivery. Prompt action can prevent losses.
If you spot damaged goods, you’ll need to follow Amazon’s procedures for removal or disposal to keep your inventory in sellable condition.
Expired Items
Products with expiration dates are sensitive and require close attention. When selling items that can expire, you risk having expired inventory if you don’t monitor their shelf life. This can include food items, medications, or cosmetics.
Once an item expires, it becomes unfulfillable immediately. You may find expired products in your inventory that must be removed or marked for disposal.
Regularly checking expiration dates helps prevent this situation and keeps your inventory fresh.
Always be proactive to avoid the hassle of dealing with unsellable items.
Defective Products
Defective products can stem from a manufacturing defect or a design defect. These happen before the item even reaches your fulfillment center.
If a product arrives defective, it will be labeled as unfulfillable. This category includes items that don’t meet Amazon’s quality standards or compliance requirements, leading to unfit status.
Sometimes, these items can be returned by the customer and become customer-damaged inventory.
Regular audits of your inventory can help you catch defects early. Addressing these issues swiftly can save you from further losses.
Customer Returns
Customer returns often contain items that may turn into unfulfillable inventory. These could be products returned because they were not as expected or were damaged during use, leading to customer-damaged inventory.
Returns can be tricky. A product that appears fine on the outside might have hidden defects.
You need to check all returned items thoroughly before putting them back in stock.
If a return is not sellable, you will have to deal with it appropriately, either by disposing of it or removing it from inventory.
Being diligent helps maintain a healthy inventory and protects your bottom line.
Common Causes of Unfulfillable Inventory
Unfulfillable inventory on Amazon can cause headaches for sellers. Understanding why it happens can help you avoid these issues. Here are some common causes:
- Product Defects: Items may arrive from suppliers damaged or defective. If a product fails quality checks, it becomes unfulfillable.
- Labeling Issues: If your products are not labeled correctly, they may not be sellable. Even small errors can lead to unfulfillable status.
Return Damages: Returns can lead to damaged goods. Products returned without proper packaging often end up unsellable.
- Storage Fees: High storage fees can occur when unfulfillable items sit in Amazon warehouses. You must keep track of your inventory to manage costs effectively.
- Expiration Dates: Some products, especially perishables, have expiration dates. If these items expire, they become unsellable.
- Email Notifications: Amazon sends email notifications about inventory status. Stay alert to these updates so you can address issues promptly.
Awareness of these causes allows you to take proactive steps. Reducing unfulfillable inventory will improve your sales and store performance.
Related Article: Why Is My Amazon Order Pending? Delays and Solutions for Seller
How To Prevent Unfulfillable Inventory
Preventing unfulfillable inventory is crucial for maintaining your Amazon seller account's health and keeping costs low. Implementing quality control measures, effective inventory management, and proper handling and storage can help you avoid issues.
Quality Control Measures
Quality control is essential to keep your inventory sellable. Start by setting up inspection processes for incoming products. Check for defects like scratches or missing parts.
Establish guidelines for your suppliers to ensure they meet your standards, too.
Train your team to identify issues early. Use checklists during receiving and storage to reduce errors.
Regularly review customer feedback to address recurring problems.
If a product consistently receives returns, it might indicate a flaw in design or description. By focusing on quality, you can minimize unfulfillable items.
Effective Inventory Management
Effective inventory management is key to preventing unfulfillable status.
Use tools for tracking stock levels and automate alerts for low or high inventory.
Implement an efficient inventory system to categorize items clearly.
Consider using Amazon’s automated unfulfillable settings. This feature allows you to quickly identify products that may not meet sellable requirements.
You can then decide whether to refurbish or liquidate these items.
Carrying out regular audits helps to keep your records accurate, reducing the chance of unfulfillable inventory piling up.
Proper Handling and Storage
Proper handling and storage are vital for maintaining inventory condition.
Always store items in a clean, dry environment to prevent damage.
Use shelves, bins, or racks to keep products organized and safe from falling.
Train your staff on safe handling practices.
For example, when moving heavy items, use equipment like dollies or forklifts to avoid damage.
Label areas clearly to avoid confusion and ensure that everyone knows where items belong.
This organized approach will help maintain inventory quality and prevent issues down the line.
Managing Unfulfillable Inventory
Managing unfulfillable inventory effectively is essential for maintaining revenue and minimizing losses. You need to know how to regularly audit your inventory, handle removal orders, and utilize Amazon’s available services.
Each of these steps plays a critical role in keeping your business running smoothly.
Inventory Audits
Conducting inventory audits helps you identify unfulfillable items quickly. Regularly review your inventory reports to catch issues early.
Keep an eye out for items that are damaged, defective, or nearing expiration.
Make a checklist for inventory audits. Consider the following:
- Check for damage: Look for signs of wear or breakage.
- Review return cases: Pay attention to customer returns, which could indicate quality issues.
- Monitor expiration dates: Ensure perishable items are sold on time.
These steps will help you manage unfulfillable inventory before it affects your sales.
Removal Orders
When it comes to unfulfillable inventory, creating removal orders is crucial.
You can easily submit a removal order through Seller Central. Select problematic items and choose "Create Removal Order" from the Action menu.
There are various ways to handle the inventory you remove:
- Liquidate: Consider liquidation if you can't sell the items.
- Dispose: If items are unsalvageable, a disposal order may be best.
- Donate: The FBA Donations Program allows you to donate unsellable items.
Being organized with your removal orders lets you clear space and keep your inventory healthy.
Utilizing Amazon Services
Amazon offers various services to help sellers manage unfulfillable inventory effectively. Familiarize yourself with the available options to make informed decisions.
- FBA Liquidations Program: This service facilitates the sale of unsellable items through liquidation companies.
- FBA Grade and Resell Program: This program allows you to refurbish damaged goods so you can sell them again.
Benefits of Reducing Unfulfillable Inventory
Reducing unfulfillable inventory can have a positive impact on your business. When you limit these items, you can improve your ROI (Return on Investment).
Every product that cannot be sold means lost potential profit.
Another advantage is better account health. Amazon values sellers who maintain high standards.
Also Read: Amazon Account Health: Complete Guide in 2024
When your unfulfillable inventory decreases, your account metrics can improve, making it easier to navigate Amazon’s platform.
Fewer unfulfillable items also mean less clutter in your inventory. This allows you to focus on products that sell well.
You can invest more time and resources into fulfilling items that contribute to your bottom line.
Additionally, reducing these items can lower storage fees. Amazon charges for storing inventory in their warehouses, so having fewer unfulfillable products keeps costs down.
This can directly affect your revenue and profits.
You might also find that your customers appreciate having a more streamlined selection.
A well-managed stock reflects a professional approach, building trust with your buyers.
Wrap Up on Amazon Unfulfillable Inventory
Managing unfulfillable inventory on Amazon is key to running a successful business and increasing your profits. By keeping a close eye on your stock and understanding why some items become unfulfillable, you can take quick action—like removing or disposing of those items—to minimize losses and work more efficiently.
Tools from SellerSprite, such as their keyword research and market research tools, can help you identify high-demand products and optimize your listings. This way, you can ensure your inventory remains relevant and in sellable condition, boosting your overall performance on Amazon.
In short, effectively handling unfulfillable inventory not only protects your profits but also keeps your customers satisfied. Staying updated on Amazon's policies and best practices will help you manage your inventory with confidence.
For a competitive edge and sustainable growth, explore the keyword and market research tools at SellerSprite. And don’t forget to sign up for a 3-day free trial to access these valuable resources!
Frequently Asked Questions
How can I reconcile customer damaged items in my Amazon unfulfillable inventory?
To reconcile customer-damaged items, start by reviewing the return details. Amazon provides specific reasons for returns, like damage reported by customers.
You can then choose to remove these items from your inventory or consider refurbishing them if feasible.
What steps should I take to fix unfulfillable inventory issues on Amazon FBA?
Begin by checking your inventory reports to identify unfulfillable items.
Next, determine why they are unfulfillable—whether due to damage, errors, or other issues.
Follow Amazon's guidelines to resolve these problems, which may include relabeling or repairing items, and create a plan to prevent future occurrences.
Can you explain the term 'distributor damaged' in relation to unfulfillable inventory on Amazon?
"Distributor damaged" refers to items that are damaged before they reach the seller.
This usually happens during transit from the manufacturer or distributor. If your inventory is marked as distributor damaged, you may be eligible for reimbursement, so it’s important to report these items to Amazon promptly.
How do I create a removal order for unfulfillable inventory on Amazon, and what are the associated fees?
To create a removal order, go to your Amazon Seller Central account.
Select the unfulfillable inventory you want to remove and choose the option for "Create Removal."
Keep in mind that Amazon charges fees for this service, which are detailed in their fee schedule. Review these costs to understand the financial impact.
What does it mean when Amazon lists my inventory as suppressed, and how can I address it?
Suppressed inventory indicates that Amazon has temporarily removed visibility from your listings.
This often happens due to listing issues like missing images or incorrect details.
To resolve this, review your product listings and make the necessary changes. Once updated, Amazon may restore your listing.
What options do Amazon sellers have for liquidating unfulfillable inventory?
When it comes to liquidating unfulfillable inventory, you have several options. You can sell items at a discounted price, donate them, or use Amazon's liquidation service.
Consider each approach carefully to minimize losses while ensuring compliance with Amazon's policies.
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