top of page

Understanding Amazon's Storage Fees (2023)

As an Amazon seller, it is crucial to stay updated with the latest policies and fee structures imposed by the platform. Among these, storage fees play a significant role in managing your inventory efficiently and optimizing your profitability. In this blog post, we will provide an overview of Amazon storage fees and highlight any recent policy changes you need to be aware of. Let's dive in!

What are Amazon Storage Fees?

Amazon storage fees are charges levied on sellers for storing their products in Amazon's fulfillment centers. These fees are designed to incentivize sellers to maintain an optimal inventory level and discourage long-term storage of unsold items.

Long-Term Storage Fees:

Amazon employs a long-term storage fee to discourage sellers from holding inventory that does not sell quickly. Previously, long-term storage fees were charged twice a year, in February and August. However, as of the recent policy change, Amazon now charges long-term storage fees monthly. This means you need to closely monitor your inventory levels to avoid incurring additional charges.

Monthly Inventory Storage Fees:

Amazon's monthly inventory storage fees are based on the space occupied by your products in their fulfillment centers. The fee structure is categorized into two categories: the standard-size and oversize items. There have been a few recent changes to the pricing structure of the monthly storage fees:

  • Starting February 1, 2023, off-peak monthly inventory storage fees (January-September) will be increased by $0.04 per cubic foot for standard-size products and $0.03 per cubic foot for oversize products. This change will first be reflected in March 2023 charges for storage that occurs in February 2023.

  • Starting October 1, 2023, peak monthly inventory storage fees (October-December) will be increased by $0.20 per cubic foot for oversize products. This change will first be reflected in November 2023 charges for storage that occurs in October 2023. There is no change to peak monthly inventory storage fees for standard-size products.

  • Starting April 1, 2023, Amazon introduced a storage utilization surcharge for the monthly storage fee. The surcharge is based on the storage utilization ratio, which is the ratio of your average daily inventory volume stored in cubic feet divided by the average daily shipped volume in cubic feet over the trailing 13 weeks. Amazon will calculate the storage utilization ratio on the last day of a given month. This means that for inventory stored in April 2023, Amazon will calculate the storage utilization ratio on April 30 and apply the surcharges in May 2023 storage fee charges.

  • The surcharge will only apply to Professional sellers with a storage utilization ratio above 26 weeks. If you meet the criteria for the storage utilization surcharge, the surcharge will be added to your base monthly storage fee and applied to the daily average volume for the space that your inventory occupies in fulfillment centers, resulting in a higher total monthly storage fee.

  • To see the full details and pricing structure, click here.

Dimensional Weight Calculation:

Amazon determines the storage fee based on the dimensional weight of your products. Dimensional weight takes into account both the weight and size of the package. If the dimensional weight exceeds the actual weight of the product, Amazon uses the former for fee calculations. Therefore, it is essential to optimize your packaging to minimize dimensional weight and reduce storage fees.

FBA Removal and Disposal Fees:

In addition to storage fees, Amazon charges fees for removing or disposing of your inventory from their fulfillment centers. Recently, Amazon has updated the removal and disposal fee structure, and it is crucial to review these changes to avoid any surprises when managing your inventory.

Inventory Performance Index (IPI):

The Inventory Performance Index (IPI) is a metric that measures your inventory management efficiency. Amazon regularly evaluates sellers' IPI scores to determine their eligibility for storage fee exemptions and storage limits. It is crucial to maintain a high IPI score to avoid excess fees and maximize your storage capabilities.

Staying informed about Amazon's storage fees and policy changes is essential for any seller aiming to optimize their inventory management and profitability. With recent updates, including monthly long-term storage fees, sellers need to pay closer attention to their inventory levels and packaging. Regularly reviewing and adjusting your inventory strategies can help minimize storage fees and maximize your success on the platform. By understanding these recent policy changes and staying proactive, you can navigate Amazon's storage fees more effectively and make informed decisions for your business.


bottom of page