How to Use Amazon Analytics Tools Online to Boost Your IPI Score

1. How to Use Amazon Analytics Tools Online to Boost Your IPI Score

2. All sellers on Amazon are concerned about their Inventory Performance Index scores (IPI scores). Amazon uses this metric to assess the inventory performances of sellers. This score reveals how efficient sellers are at managing their FBA inventory on Amazon. Sellers can find this metric in their Amazon Seller Central accounts. Amazon hasn’t revealed exactly how it formulates IPI scores. But, the general belief among sellers is that the following four factors determine their IPI scores – The seller’s inventory management skills (for fixed periods). That means every month or every three/six-months you don’t have excess stock in Amazon’s warehouses. Maintaining this tight balance between sold and available stock is very important. Their ability to balance their inventory levels as per the number of sales they register. By doing so, sellers can avoid warehousing issues with Amazon. Let’s say your Amazon account isn’t generating sales and your stock is piling up in an Amazon warehouse. Amazon doesn’t want to deal with these long-term storage fees. So, they reward sellers who can balance their inventory levels by giving them higher IPI scores. Their ability to fix listing problems as quickly as possible. For example, sellers who frequently list products that are unavailable for purchase score poorly on this metric. Their ability to keep popular items in stock most of the time. This metric also reflects the seller’s user- friendliness. If you’re able to always keep your best-selling items in stock, you’ll generate more sales. That’s what Amazon wants from its top sellers. If an Amazon FBA seller meets these four metrics, his/her inventory health is deemed to be in good health. According to Amazon, all sellers get IPI scores between 0 to 1,000 – the higher a seller’s score, the better. IPI scores fluctuate with time.

3. Amazon updates this metric every week. That means having good inventory health for only a few months isn’t enough. All sellers must consistently work to improve their IPI scores. Every year, Amazon conducts two wide-scale IPI checks. Sellers who fail in the first check don’t get to send their inventory to Amazon’s warehouses for the next quarter. Sellers who score the second check may get delisted from the eCommerce platform altogether. After all, Amazon’s priority is to ensure that the warehouse spaces they pay for are used efficiently. They don’t want to give inefficient sellers access to their FBA warehouses. They don’t want to store unsold for long periods either. That’s why the company uses IPI scores to determine which sellers deserve to access their warehouse spaces. How to Improve Your IPI Score? Now that we know Amazon’s objectives behind maintaining IPI scores, let’s explore how sellers can improve these scores. Amazon hasn’t officially revealed exactly how they come up with these scores. However, the top sellers on Amazon with the highest IPI scores do some things that sellers with low scores don’t. Here’s how the top sellers on Amazon secure high IPI scores – Minimizing the Risk of Excess Inventory Amazon FBA warehouses are “fulfillment centers.” They’re not storage facilities. Amazon likes it when sellers quickly move their products from FBA warehouses to customers’ doorsteps. If your products are laying idle in an Amazon warehouse, it’s not a good look for you as a seller.

4. Whenever sellers have excess inventory, Amazon tells them what to do with all that excess inventory. Top sellers always manage excess inventory by pre-scheduling their orders. They use advanced analytics tools to understand the demand for certain products. Then, they only source items that they know will sell within 30 to 90 days. Avoiding Stranded Inventory Stranded inventory is every Amazon seller’s worst nightmare. It’s a de-listed product that’s still stored in Amazon’s warehouse. Let’s say you face listing issues with a specific product on Amazon. Your product gets de-listed and customers can no longer see it on the platform. Hence, you’re not only losing sales, but you’re also spending unnecessarily on storage fees. Sellers must relist the standard products as quickly as possible. Even better – they should avoid having stranded inventory in the first place. Using Advanced Amazon Analytics Tools How do top sellers on Amazon always maintain high IPI scores? Well, they manage their inventory in the best way possible. How do they manage their inventory to avoid issues like excess stock or stranded stock? They use the latest Amazon analytics tools online. For all sellers on Amazon, inventory management becomes extremely difficult when the number of their SKUs (stock-keeping units) rises.

5. To simplify this process, sellers used advanced Amazon inventory analytics tools. With these tools, they can always track and manage their inventory levels in real-time. They can also use historical inventory data from these tools to predict future inventory levels. Amazon constantly tracks the inventory management performances of all the sellers on its platform. The sellers who use advanced inventory management and analytics tools stay a step ahead of Amazon.

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