Amazon is introducing a new capacity management system for third-party sellers using its fulfillment services. This system will allow sellers to bid for additional storage space, giving them more control over their FBA capacity and limiting unproductive use. The highest reservation fee per cubic foot offered by a seller will be granted first, and fees will be offset by performance credits from sales tied to the extra capacity. This will benefit brands who need more inventory space to support new product launches or marketing campaigns.
Amazon CFO Brian Olsavsky noted that the company has been operating with “very high” inventory levels, making productivity improvements more challenging. The new system will also provide sellers with a monthly capacity limit for how much they can send to and store at Amazon, replacing the weekly restock limit and quarterly storage limit. This will make it easier for sellers to plan how much inventory to procure and manufacture.
Overall, the new capacity management system will give sellers more control over their FBA capacity and make it easier for them to plan their inventory. It will also be beneficial for brands who need extra inventory space to support their product launches or marketing campaigns.