How much is the qualified Amazon IPI? How to calculate IPI?

Amazon IPI stands for Inventory Performance Index, which is an index of Amazon inventory performance. This index has a threshold. Sellers who do not reach the threshold will have their FBA inventory quantity restricted. So, what is the qualified Amazon IPI?

The IPI standard currently set by Amazon is 450 points. Only when this standard is reached will sellers not be subject to storage restrictions.

How to calculate IPI?

Amazon has not disclosed how it calculates IPI, saying that it is private, like the Buy Box algorithm, and will not be published. As for how to improve IPI, Amazon only gave an explanation that is not of much reference value: the best way to improve your IPI score and minimize your FBA storage fees is to reduce worthless inventory and keep valuable inventory at a lean level, while ensuring that you have enough inventory to minimize sales losses.

Amazon says there are four factors that affect IPI:

• Reduce excess inventory and improve profitability

• Increase sales to balance inventory weeks

• Ensure inventory is available for purchase by adjusting the stranded listings

• Increase sales by keeping popular items in stock

However, only the first 3 points are influencing factors, as Amazon has publicly stated that IPI points will not be deducted for insufficient inventory. In addition, stranded products will affect your IPI score, but this problem is easily solved. In other words, the key factors to improving your IPI are to avoid having too much inventory on Amazon and to improve your sell-through rate. The sell-through rate is calculated as follows:

Sell-through rate = the number of stocks sold within 90 days / the average total stock within 90 days

For example, if you sold 100 units of inventory in the last 90 days and had an average of 200 units of inventory during that time, your average sell-through rate would be 0.5. In addition, some sellers suspect that Amazon will severely penalize products that have zero sales in 90 days.

In general, the minimum standard for Amazon's IPI is 450 points, but it is recommended that merchants maintain their store's IPI score at around 600 points, which should be at least 50 points higher than 450 points.