Amazon FBA, answered.
A working seller's reference for the 29 questions that come up between your first FBA shipment and your hundredth — written without affiliate fluff or signup walls.
Contents
06 chapters · 29 questionsGetting started with FBA
The basics — how Fulfilment by Amazon works on amazon.in, which charges apply, and how to get a first shipment to a fulfilment centre.
How does Amazon FBA actually work?
On amazon.in you register for FBA, choose the fulfilment centres in the state where your GST is registered, and add them to your GST certificate as additional places of business. Once FBA is enabled you create a shipment with Send to Amazon and send it to the FC, either with Amazon Transportation Services or your own carrier. Units can be bought once Amazon has received them, and how long receiving takes varies. Source: Amazon Seller Central, Get started with Fulfilment by Amazon (FBA).
What does FBA actually cost — the fee structure in one breath?
Four kinds of charge, all before 18% GST. A referral fee, a percentage of the sale price that varies by category. A closing fee, a fixed amount set by price band. FBA fulfilment fees, made up of a per-unit pick-and-pack fee and a weight handling fee per shipment that depends on weight, delivery zone and your STEP level. And a storage fee per cubic foot per month. Units older than 150 days also attract the long-term storage fee, which Amazon also calls the aged inventory surcharge, and removal orders carry a per-unit removal fee. The FBA vs Easy Ship vs Self-Ship guide has the October 2026 tables and a worked example. Source: Amazon Seller Central, FBA fulfilment fees.
How do I sign up for FBA?
Amazon's get-started page lists the steps: register for FBA in Seller Central, choose the fulfilment centres in the state where you hold your GST registration, share your business details, add those centres to your GST certificate as additional places of business, then send your products. It says it enables FBA within 24 hours of verifying your documents, and that adding FBA carries no extra setup charge or subscription fee. Source: Amazon Seller Central, Get started with Fulfilment by Amazon (FBA).
FBA vs FBM — which should I choose?
It depends on price, weight, how much you can store and pack yourself, and whether you want the Prime badge. FBA products are Prime-eligible, other than large appliances, furniture and similar items, and Amazon takes packing and returns off your hands, at the cost of FBA fees and replenishment planning. On amazon.in the merchant-fulfilled options are Easy Ship and Self-Ship (and Seller Flex), and you can run both channels. At low prices the closing fee often decides the comparison, so work it out at your own price and weight: the FBA vs Easy Ship vs Self-Ship guide does that.
How do I prepare my first FBA shipment?
Use Send to Amazon: choose the inventory to send, confirm packing and shipping, book the appointment where needed and print the labels. Amazon requires FNSKU labels printed from Seller Central, since labels from third-party generators may not scan at the fulfilment centre. Track the shipment under Manage Shipments. If Amazon counts fewer units than you sent, the difference appears on the shipment's Contents tab and can be reconciled: see the inbound shipment discrepancies guide. Source: Amazon Seller Central, Create shipments with Send to Amazon.
FBA fees & profitability
How Amazon charges for storage, fulfilment and aged inventory on amazon.in — and how to calculate margin that won't lie to you.
What's the difference between a referral fee and an FBA fee?
On amazon.in the FBA charges are a per-unit pick-and-pack fee and a weight handling fee per shipment. The weight handling fee depends on the shipping weight, the delivery zone and your STEP level, so it is not one flat figure. The closing fee also differs by channel. Source: Amazon Seller Central, FBA fulfilment fees.
How do monthly vs long-term storage fees work?
Monthly storage is charged per cubic foot, on your daily average volume for the month, between the 7th and 15th of the following month. Amazon's amazon.in page lists one monthly rate and states no seasonal one. The long-term storage fee is added on top for sellable units that have been in a fulfilment centre for more than 150 days: one rate for 150 to 365 days and double that rate beyond 365 days, assessed on the last day of each month. The long-term storage fee guide has the rates, a worked example and the catches, including a per-unit figure Amazon's own page states two ways. Source: Amazon Seller Central, FBA long-term Storage Fee.
What is the aged inventory surcharge?
Amazon's amazon.in pages use two names for one charge: the long-term storage fee, and the aged inventory surcharge (previously known as the long-term storage fee). It is an extra monthly fee on sellable units older than 150 days. Selling them or requesting a removal before the last day of the month avoids it, but Amazon's Send to Amazon help says removing units that would have been charged can stop you sending more of that ASIN for three months. See the long-term storage fee guide.
How do removal and disposal fees work?
If a SKU isn't selling or you want it out, you can create a removal order (Amazon ships the units to an address you choose) or dispose of it (Amazon destroys them). On amazon.in the fee is per unit, before 18% GST: for standard-size items ₹10 for standard shipping and ₹30 for fast shipping, ₹100 for heavy and large items, and ₹0 for disposal. Source: Amazon Seller Central, FBA removal order fees. The removal order guide covers creating one, timing and claims.
How do I calculate my true margin per SKU?
Start from the sale price and subtract the referral fee, closing fee, FBA fulfilment fees, monthly storage allocated by how fast the SKU sells, your cost of goods (including inbound freight and duties), advertising attributed to that ASIN, the cost of returns, and any aged-inventory surcharge. What is left is your contribution margin, which says more about whether a SKU is worth restocking than revenue does.
Inventory & restock planning
How Amazon rates your inventory efficiency, and the arithmetic that tells you when to send the next shipment.
What is the IPI score and why does it matter?
Amazon India's Inventory Performance dashboard rates three areas: excess and aged inventory, your 90-day sell-through, and stranded inventory. Each shows as Excellent, Good, Fair or Poor. Amazon says the biggest levers are your own actions: keep a balanced level between sales and stock, avoid excess and aged inventory, and fix listing problems. It treats an item as excess when it has more than 90 days of supply on forecast demand, and suggests holding enough for 30 to 60 days of expected sales. The pages we read do not give a numeric score range or a target, so read yours from your own dashboard. New ASINs are left out of IPI for their first 90 days, and units under a removal request stop counting once it is placed. Source: Amazon Seller Central, Inventory performance. Source: Amazon Seller Central, IPI frequently asked questions.
How do FBA capacity limits work?
Amazon India's pages say your IPI score is used in the calculation of FBA capacity limits, the fulfilment-centre-level storage limits applied to sellers. The pages we read do not set out India limit types, formulas or thresholds, and categories from other marketplaces should not be assumed to apply. Read the limits shown in your own Seller Central account. The levers Amazon names are less excess and aged stock, better sell-through and fewer stranded listings. Source: Amazon Seller Central, Inventory performance.
What is sell-through rate?
Amazon defines the FBA sell-through rate as units sold and shipped over the past 90 days divided by the average number of units in stock in its fulfilment centres over the same period, averaged from snapshots of your inventory today and 30, 60 and 90 days ago. Amazon's example: 120 units shipped against an average of 80 available is a rate of 1.5. It shows your rate against a Good (green) range on the Inventory Performance dashboard; the pages we read do not state a numeric threshold. Source: Amazon Seller Central, IPI frequently asked questions.
How do I calculate "days of cover"?
Sellable units ÷ daily sales velocity. If you have 600 units of an ASIN selling 20 a day, you have 30 days of cover. To decide when to ship, add your own lead time and a safety buffer: reorder point = daily velocity × (lead time + safety days). The reorder point and days of cover guide has the formulas and worked examples, and shows when stock that is already on the way should and should not be counted.
How do I forecast restock without spreadsheets?
For each SKU and each fulfilment centre you need four numbers: daily velocity, sellable units on hand, units already on the way and your lead time. Units to send = velocity × (lead time + target days of cover) − (on hand + on the way); if that is zero or negative, send nothing. Tools can run this for you and let you set per-warehouse thresholds. Treat the result as a planning estimate: it assumes sales stay at the velocity you used. The reorder point guide covers seasonal demand and variable sales.
Reimbursements & FBA claims
Money Amazon may owe you when units are lost or damaged in its custody, or when a fee is charged wrongly. Which rules apply depends on the event.
What's actually reimbursable?
Where to look differs by event. Losses inside a fulfilment centre show in the Inventory Ledger, and the Reimbursements report shows what Amazon has already paid. Inbound shortages appear on the shipment's Contents tab. Removal problems appear in the removal order reports. Incorrect fees are a separate route: Amazon's pages ask for claims about an incorrect fulfilment fee within 60 calendar days of the order being shipped, and for referral or closing fees within 30 calendar days (the page words the start as the order being shipped in one place and placed in another). Whether anything is paid, and how much, is Amazon's decision under its policy. See the FBA reimbursement guide. For a damaged unit, the amount depends on the category and, where Amazon grades the unit, the grade: see damaged inventory reimbursement rates. Source: Amazon Seller Central, FBA lost inventory reimbursement policy. Source: Amazon Seller Central, FBA inventory reimbursement policy (damaged inventory). Source: Amazon Seller Central, FBA-FC reimbursement rate of damaged product and grade-based reimbursement.
How long do I have to file a reimbursement claim?
On amazon.in it depends on the loss, and each window starts from its own event: a unit lost in a fulfilment centre, 60 days from the inventory adjustment; units missing from an inbound shipment, 60 days (Amazon words the start as delivery in one place and receipt in another, so count from the earlier date), and not before 14 days after receipt; a lost removal order, 30 days from when it shipped; a removal order delivered short, damaged or swapped, 7 days from delivery. Units lost in transit, and returns damaged by the buyer or carrier, are reimbursed automatically on a 45-day clock, and units damaged in the warehouse on a 60-day clock. There is no single window for all claims. Appeals on a resolved case must be made within five business days of its last resolution, and a re-evaluation of the amount within 60 days of the original reimbursement. Source: Amazon Seller Central, FBA lost inventory reimbursement policy. The FBA reimbursement guide covers each window, the removal order guide covers removals, and the inbound shipment discrepancies guide covers inbound shortages.
How do I file a reimbursement case myself?
For a loss inside a fulfilment centre, start from the Detail view of the Inventory Ledger: find the event (date, FNSKU, quantity, fulfilment centre, reference ID), rule out a transfer to another centre, and check the Reimbursements report and the ledger's reconciliation columns to see whether Amazon has already matched or paid for the units. If units remain unreconciled and the window is open, contact Seller Support with the ASIN or FNSKU and the missing quantity. Inbound shortages, removals and returns go through different routes: see the guides linked in the answer above. The Inventory Ledger guide walks through the ledger. Source: Amazon Seller Central, FBA lost inventory reimbursement policy.
When does it make sense to use a reimbursement service?
When the volume of discrepancies outgrows the time you have to check them. Some services charge a share of what they recover, so compare that fee with what you would recover on your own. Check that a service supports amazon.in before signing up, because policies and claim windows here differ from other marketplaces.
What evidence do I need on hand before filing?
It depends on the claim. For a loss in a fulfilment centre Amazon asks for the ASIN or FNSKU and the missing quantity. For missing inbound units it needs proof of delivery (the Delivery Challan, or the fulfilment centre-stamped Stock Transfer Note plus the Electronic Proof of Delivery) and proof of ownership such as a supplier invoice. For a removal delivered short it asks for the removal order ID, tracking ID, the shipping label, proof of delivery and images of the contents, and may require an unboxing video. Keep those documents for as long as a claim on that stock could still be open. Source: Amazon Seller Central, FBA lost inventory reimbursement policy. Source: Amazon Seller Central, Reconcile your shipment.
Multi-warehouse & 3PL operations
When FBA alone isn't enough — splitting stock across Amazon FCs, third-party fulfilment and your own storage without losing track.
Why do sellers split inventory between FBA and a 3PL?
FBA gives you the Prime badge but charges storage fees, charges extra on aged stock and carries size and weight rules. A third-party logistics provider (3PL) or your own store can hold bulk reserve stock, sell on other channels, and handle items that suit FBA less well. Whether the split pays depends on your volumes and fees, so cost it for your own SKUs.
What is "stranded inventory" and how do I fix it?
Units physically sitting at an FBA centre that can't be sold because the product has no active listing. Amazon's Inventory Performance page measures it as a percentage of your FBA units not available to buy and links a Fix stranded inventory page in Seller Central. Either fix the listing or remove the units; stranded stock keeps costing you storage and, per Amazon, can lower your IPI. Source: Amazon Seller Central, Inventory performance. Seller Central → Fix stranded inventory.
Can I transfer stock between FBA fulfilment centres?
Not directly. Amazon decides how your inventory is distributed across the fulfilment centres you are registered in, so you don't control which centre holds what. The closest workaround is a removal order back to your address followed by a new shipment to the centre you want, which costs the removal fee and the removal lead time (Amazon's page says 10 to 14 business days, longer in peak periods) and is usually only worth it for high-value stock. The removal order guide covers how to create one.
How does Amazon decide which fulfilment centre receives my stock?
Amazon's Inventory Placement help says that if you are registered for both fulfilment centres it names (BOM1 and BLR5), Amazon determines the distribution of your inventory during shipment creation, which may mean several shipments for one SKU. It also describes a Premium Placement Service, offered for a limited period when we read it, that lets you send eligible shipments to a single centre, with exceptions for categories such as apparel and shoes. Which options your account has can differ, so check Send to Amazon in your own account. Source: Amazon Seller Central, Inventory Placement.
Operations & data hygiene
Which Amazon reports to use for which question, when to move off spreadsheets, and how to audit your inventory against reality.
Inventory Ledger vs Manage Inventory report — which do I trust?
Use the Ledger to explain why a number changed and to gather evidence for a claim; use Manage Inventory for day-to-day decisions. If the two disagree, work out why with the Ledger's events (transfers in transit and units in other dispositions are common causes), and ask Seller Support if it stays unexplained. Source: Amazon Seller Central, Inventory Ledger report.
How do I audit inventory discrepancies?
Pull the Inventory Ledger in the detailed view for one FNSKU at a time (Amazon's tip is to use the FNSKU field to reconcile), and tie each adjustment to a known event: inbound, sale, return, removal or transfer. Amazon's help says a downloaded file or API pull carries Reconciled and Unreconciled quantity columns on Adjustments rows, showing what Amazon has already matched; check your own export for them. Anything you cannot explain is worth investigating, not proof of a loss: it may be a transfer in transit or already reimbursed. The Inventory Ledger guide shows how. Source: Amazon Seller Central, Inventory Ledger report.
How do I export reports from Seller Central?
In the redesigned Seller Central the reports are under Supply chain, Supply chain reports; Amazon's older help text calls the same area Reports, Fulfilment. For the Inventory Ledger, Amazon's steps are to choose the detailed or summary view, set the date range, optionally filter by SKU, FNSKU or ASIN, and request a .csv or .txt download. Filtering the detailed view by event type shortens generation time. For an automatic daily feed you need the Selling Partner API (SP-API), which many inventory tools use.
SP-API vs CSV uploads — what's the difference for me?
A CSV upload is manual: you download the report from Seller Central and upload it. SP-API is automatic once you authorise it: your tool pulls data on a schedule. Which a tool supports varies, so check before you rely on one. Starting on CSV and moving to SP-API once the weekly re-download becomes a chore is a common path.
When have I outgrown spreadsheets?
Three signals: copy-pasting reports takes a meaningful share of your week; you have missed reorder windows because the sheet was stale; or you cannot reconcile what Amazon says you have against what you think you have. Any one of these suggests it is time for something more automated.
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