Even though it's January, Amazon sellers are still in PEAK fee season. 🔝

Why?

Because Monthly Inventory Storage Fees (and any Aged Inventory Surcharges) from December will be assessed between the 7th and 15th of this month.

So, if you're sitting on excess stock from Q4, and want to avoid a hefty storage bill, you have a decision to make:

1) Sell-through
2) Remove
3) Dispose/destroy
4) Liquidate

❌ Selling through the inventory is likely not an option. I mean, you were probably running promos on this inventory during Q4 and you couldn't clear it.

❌ Removals take *forever* to actually get the product back. And, it's going to come in onesie, twosie shipments because Amazon has the inventory distributed through its network. And, you're going to have to process and grade the inventory when it comes back.

❌ Disposals now cost the same as Removals (this change happened in 2023), so there's no longer an "arbitrage" opportunity in deciding to Remove vs Dispose.

✅ Which leaves...Liquidations.

I'll argue until I'm blue in the face 🥶 that this should be your default option for dealing with excess inventory on Amazon.

As a simple heuristic, you should liquidate all products for which:

👉 Upcoming Monthly Inventory Storage Fees > (T30D Sales x Cash Payout %)

Put differently, if your cost of keeping the product at Amazon for the next 30 days is going to exceed the cash returned to your balance sheet from the next 30 days of sales, then you should Liquidate.

(FYI: Cash Payout = Sales - Referral Fees - FBA Fees - PPC Costs)