Amazon FBA Inventory Performance Index: How the 400 Threshold Works and What Your Inbound Prep Has to Do With It

Most IPI guides point sellers toward promotions, price cuts, and removal orders. The underlying math tells a different story: two of the four sub-metrics that feed the Inventory Performance Index are shaped at the inbound shipping stage, before a single unit reaches a fulfillment center. A mislabeled FNSKU, a batch sent too early, a shipment routed to one FC instead of four - these are logistics decisions, and each one shows up directly in the score.

What the IPI Score Is and How Amazon Uses It

Amazon scores every FBA seller on a 0-to-1000 scale. The number that matters operationally is 400. Sellers who stay at or above 400 receive unlimited standard storage across the fulfillment network. Sellers who fall below 400 at the enforcement evaluation date receive storage-volume limits for the entire following quarter - 13 weeks, not a temporary restriction that lifts when the score recovers.

The score refreshes every Monday, reflecting data through the end of the prior week. A large receiving event on Thursday will not register in IPI until the following Monday at the earliest. Planning around the score means planning around that weekly rhythm, especially in the six weeks before each quarter's evaluation deadline.

The average IPI for active FBA sellers has historically hovered around 500 to 550, based on Amazon's own seller communications. The dashboard labels 600 and above as "Excellent." The 400 floor is not a stretch goal - it is the baseline required to operate without a ceiling on how much stock you can hold.

The Four Sub-Metrics Unpacked

Amazon does not publish the exact weighting of the four inputs, but the math behind each is transparent enough to act on.

Excess Inventory Percentage

A product is flagged as excess when you hold more than 90 days of supply, measured against trailing 90-day sales velocity. Units do not just drag IPI at that point - they accumulate cost. Amazon assesses an aged-inventory surcharge at 181 days in an FC and again at 271 days. The excess percentage is the share of your total FBA units currently over that 90-day threshold. Reducing it requires either accelerating sales or removing stock before the surcharge windows hit.

Sell-Through Rate

Sell-through is units sold and shipped in the trailing 90 days divided by average 90-day inventory on hand. A ratio above 2.0 - turning stock more than twice per 90-day period - is considered healthy for IPI purposes. The denominator is the trap: anything sitting in an FC without sales pulls the ratio down. That includes stranded units, which count as on-hand inventory while contributing zero sales to the numerator.

Stranded Inventory Percentage

Stranded inventory is stock sitting at an FC against a listing with no active buy-box offer. The unit occupies shelf space, inflates the on-hand denominator for sell-through, and earns nothing. Even a small number of stranded units hits disproportionately hard on accounts where total inventory is measured in hundreds rather than thousands - the denominator suppression is proportionally much larger.

In-Stock Rate

In-stock rate measures the percentage of time replenishable ASINs are in stock, weighted by each ASIN's historical sales. An ASIN with strong sales history that goes out of stock for two weeks costs far more IPI points than a slow-mover with the same stockout. This sub-metric penalizes large quarterly shipments followed by depletion gaps. It rewards continuous, consistent replenishment.

The Evaluation Timeline

Amazon evaluates IPI for storage-limit enforcement six weeks before the start of each fiscal quarter. The practical deadlines:

• Mid-January for Q1 limits
• Mid-April for Q2 limits
• Mid-July for Q3 limits
• Mid-October for Q4 limits

The "two consecutive weeks below 400" rule is where sellers get caught. Falling to 398 on one Monday evaluation is a warning. Staying below 400 the following Monday triggers a full-quarter storage limit. That means recovery efforts - removals, listing fixes, replenishment changes - must succeed within a single week to avoid the lock-in. The window is shorter than it appears.

Capacity Manager and the IPI Gate

Under the Capacity Manager system Amazon introduced in late 2023, all FBA sellers receive a base cubic-footage allocation. The 400 threshold determines access to more. Sellers above 400 can bid for additional capacity through monthly auctions, offering a reservation fee per cubic foot of requested space. Sellers below 400 are excluded from bidding entirely - no auction access, no supplemental storage, regardless of sales history or account age.

The auction mechanics favor compliant operations in a second way. Accepted bids are offset dollar-for-dollar by performance credits when the seller fills the space and sells at the projected velocity. A well-prepped shipment that arrives accurately labeled, processes without holds, and moves at the projected rate effectively cancels the reservation fee. A shipment sitting in research status or triggering defect holds pays the fee with no offset.

For Q3 and Q4 - the quarters when cubic-footage demand peaks - auction exclusion is not a minor inconvenience. It is a structural ceiling that no promotional strategy can work around. The IPI score that unlocks auction access is set by the mid-July and mid-October evaluations, which are themselves shaped heavily by what shipped in June, July, August, and September.

How Inbound Prep Quality Directly Controls Two Sub-Metrics

FNSKU Labeling Errors and Stranded Inventory

Incorrect FNSKU labels at inbound are a primary cause of stranded inventory. When Amazon receives a unit it cannot match to an active ASIN - because the label is wrong, smudged, or placed over a barcode that scans through - the unit enters research status. It sits in the FC, counts against on-hand inventory for sell-through purposes, and contributes zero sales. That is stranded inventory, created at the prep stage before the shipment left the warehouse.

Barcode scan-verification during prep - confirming each unit scans to the correct ASIN before boxing - eliminates this cause entirely. A prep center running scan-verification as a standard step removes the labeling-error path to stranded inventory before it starts.

Inbound Defects, Single-FC Routing, and In-Stock Rate

Inbound defect strikes - issued through Amazon's Inbound Performance dashboard - carry a specific operational penalty: Amazon routes all subsequent shipments to a single fulfillment center instead of distributing them across the network. The types of violations that trigger strikes include:

• Mislabeled or incorrectly labeled shipments
• Quantity discrepancies between shipping plan and physical contents
• Prep violations - missing poly bags, inadequate cushioning, improper bundling
• Wrong items in a shipment relative to the shipping plan

Single-FC routing concentrates your inventory geographically. Customers outside that FC's delivery zone face longer estimates; some ASINs lose buy-box eligibility in affected regions. Amazon interprets reduced regional availability as reduced in-stock performance, which suppresses in-stock rate even when units are technically on hand. The connection is traceable: prep errors cause defect strikes, strikes force single-FC routing, single-FC routing degrades geographic coverage, geographic gaps suppress in-stock rate, in-stock rate drags IPI.

The Q4 Tension: Sending Early vs. Triggering Excess

The standard Q4 advice is to ship inventory early - before Amazon's receiving surcharge window opens in mid-October. That advice is directionally correct, but it collides with the IPI evaluation calendar in a specific way that most guides miss.

The mid-October IPI evaluation sets Q4 storage limits. Sellers who send large Q4 batches in September and early October to beat the surcharge window arrive at that evaluation with elevated on-hand inventory. If Q4 sales velocity has not yet accelerated at evaluation time, those units may already approach or cross the 90-day excess threshold. Excess inventory percentage spikes. IPI drops. The evaluation that locks in Q4 capacity limits captures the score at its lowest point.

The trade-off requires ASIN-level modeling: estimate Q4 sales velocity per ASIN, calculate how many days of supply a planned shipment represents at that velocity, and size each batch so no ASIN crosses 90 days of supply before peak velocity accelerates. Batch splitting is not a logistics preference - it is an IPI management decision.

Prep Center as a Staged Buffer

The most underused structural IPI strategy is the staged buffer: holding safety stock at a prep center and releasing inventory to Amazon in weekly batches sized to keep in-stock rate high without accumulating excess on the FBA side.

A worked example: an ASIN sells at a rate of 70 units per week during peak season. The 90-day excess threshold is crossed when supply on hand exceeds roughly nine weeks of forward demand at that rate. A seller shipping direct from supplier in one monthly batch arrives at week five with minimal units on hand - a stockout risk - then restocks with another large batch, creating an immediate excess flag. In-stock rate drops during the low-inventory window; excess percentage spikes in the days after the restock arrives.

The staged approach: the supplier ships a larger quantity to the prep center. The prep center labels, preps, and releases a defined weekly batch to Amazon. On-hand inventory at the FC stays within a narrow range around one to two weeks of demand. No stockout. No excess flag. In-stock rate stays high because replenishment is continuous rather than episodic. The prep center absorbs the carrying function that Amazon's IPI math penalizes when inventory accumulates inside the FC.

This requires a prep center capable of receiving supplier pallets, labeling and prepping to FBA standards, and releasing in defined weekly batches on a schedule - not just processing in bulk and forwarding immediately. The operational discipline is on the prep side, not the Amazon side.

The Six-Week Recovery Playbook

Six weeks is the window between an IPI warning and the storage-limit lock-in date. The order of operations matters because different actions have vastly different response times.

1. Fix stranded inventory first. Pull the Stranded Inventory report in Seller Central and relist, close, or remove each affected ASIN. Listing fixes take effect within 24 to 48 hours and improve both stranded percentage and sell-through rate simultaneously.
2. Submit removal orders immediately. Removals take 14 to 30 business days to process, and units remain on-hand in the IPI calculation until Amazon physically dispatches them. Submit on day one of the recovery window, not day four.
3. Audit inbound defects. Open the Inbound Performance dashboard and check for active strikes or single-FC routing restrictions. Identify the prep violation that caused each strike and correct the process before the next shipment leaves.
4. Switch to weekly replenishment batches. If shipments have been monthly or quarterly, shift to weekly immediately. This begins rebuilding in-stock rate within the first one to two weeks.
5. Implement scan-verification on all outgoing shipments. If labeling errors are a risk in your current prep process, scan-verify FNSKU labels before boxing this week's shipment.
6. Check the score each Monday. IPI refreshes weekly. Confirm that stranded fixes and replenishment changes are moving the sub-metrics before the next evaluation Monday closes.

The removal order lag is the playbook's hardest constraint. Waiting until week four to submit removals almost guarantees those units are still counted as on-hand inventory at the lock-in evaluation.

Reading the IPI Dashboard

Which Metrics Respond Fastest

Stranded inventory percentage responds in one to two days after listing fixes - it is the fastest lever available. In-stock rate responds within one to two weeks of consistent weekly replenishment. Sell-through rate improves over the full 90-day trailing window and requires sustained sales velocity, not a single action. Excess inventory percentage clears only after removal orders complete or genuine sell-through burns down the overhang.

When a score drops unexpectedly, check stranded percentage first. It is both the fastest to diagnose and the fastest to fix.

Where to Find Each Metric in Seller Central

• Inventory - Inventory Performance: the main IPI gauge with sub-metric breakdown and Amazon's recommended actions for each
• Inventory - Manage FBA Inventory, filtered by "Stranded": the working list of units to relist or remove
• Inventory - Manage Excess Inventory: units flagged over the 90-day threshold and estimated aged-inventory surcharge exposure
• Shipments - Inbound Performance: defect strikes, problem rates, and any active single-FC routing restrictions

The score that determines your Q4 storage capacity is set six weeks before the quarter starts, not six weeks into it. Every prep and shipping decision made in August and September is an IPI decision.

Comparing Responses to Common IPI Problems

Problem	Marketing response	Operational response	Time to IPI impact
Excess inventory	Run promotions to accelerate sell-through	Submit removals; reduce next batch size	Promotions: faster but demand-dependent; removals: 14-30 business days
Stranded inventory	Close and relist the ASIN	Fix FNSKU labeling at prep stage to prevent recurrence	Listing fix: 1-2 days; prevention: immediate for next shipment
Low sell-through rate	Lower price to drive velocity	Reduce on-hand via smaller, more frequent shipments	Pricing: variable; batch sizing: improves over 90-day window
Low in-stock rate	Not addressable through marketing	Weekly replenishment batches; staged buffer via prep center	1-2 weeks for measurable improvement
Single-FC routing from defect strikes	Not addressable through marketing	Correct prep violations; clear inbound performance record	Varies - routing changes after strike record clears

Frequently Asked Questions

If my IPI recovers mid-quarter, do storage limits lift early?

No. Once limits are applied for a quarter they remain for the full 13 weeks regardless of score recovery. The enforcement date is what determines limits, not ongoing score performance. Your score recovery matters for the following quarter's evaluation, not the current one.

How long after a shipment is received does it show up in my IPI?

A receiving event will not appear in your IPI until the Monday following the week it processed. Units received on Thursday show up in the next Monday refresh at the earliest. In the final two weeks before an evaluation deadline, this lag is significant - a shipment sent too late to process and register before the evaluation Monday will not help your score for that quarter.

Can a seller with strong sales velocity still lose Capacity Manager auction access?

Yes. Auction access is gated by the 400 IPI threshold, not by sales velocity. A seller with high velocity but elevated stranded inventory percentage, persistent excess flagging from over-sending, or recurring inbound defect strikes can fall below 400 and lose auction access at the quarters when additional cubic footage matters most. The score reflects all four sub-metrics together.

What is the single fastest action to raise a dropping IPI score?

Fix stranded inventory. Relisting or removing stranded units updates stranded percentage within one to two days and simultaneously improves sell-through rate by removing non-selling units from the on-hand denominator. Submit any removal orders the same day for excess units, since those take up to 30 business days to clear. Combining both actions on day one of a recovery window gives each the maximum time to process.

Does a prep center need to be near Amazon FCs to work as a weekly replenishment buffer?

Geographic proximity shortens transit time and makes weekly batch releases more predictable, but the buffer strategy works at any distance as long as transit time is factored into the release cadence. The key variable is confirmed lead time from the prep center to Amazon receiving - build that into your weekly release schedule so each batch arrives before the prior week's stock depletes. A prep center with consistent, trackable transit times is more valuable than a closer one with variable delivery.

Why does single-FC routing hurt in-stock rate if my units are physically in stock?

In-stock rate is weighted by historical sales, which includes regional demand. When defect strikes force single-FC routing, customers outside that FC's fast-delivery zone face longer shipping estimates or lose one-day and two-day eligibility. Amazon treats reduced regional delivery performance as reduced effective availability. The units exist, but they are not available at competitive delivery speeds across all demand regions - and the in-stock rate calculation reflects that gap. Check the Inbound Performance section of Seller Central for current routing status and the specific violation that triggered any active restrictions.