Amazon IPI (Inventory Performance Index) is a metric used by Amazon to measure the performance of a seller's inventory management. It is calculated by taking into account various factors such as sales, inventory level, and customer service.
The IPI score ranges from 1 to 1,000, with a higher score indicating better performance. A score of 800 or higher is considered good, while a score of 700 or lower is considered poor.
The main factors that contribute to the IPI score are:
Sales: The amount of sales for a given period.
Inventory level: The number of units in stock and the number of days it will take to sell the current inventory.
Customer service: The number of customer complaints, returns, and claims.
Stockouts: The number of times an item is out of stock and the duration of each stockout.
Lead time: The time it takes for an order to be fulfilled and shipped to the customer.
Lost sales: The number of sales that were lost due to stockouts.
A seller with a high IPI score is more likely to be eligible for benefits such as increased buy box exposure, lower referral fees and reduced long-term storage fees and priority for new product launches.
To improve their IPI score, sellers should focus on maintaining an adequate level of inventory, keeping their lead time short, and providing good customer service to avoid complaints and returns. Additionally, sellers should also use Amazon's tools and analytics to manage their inventory and track their IPI score over time.
On the other hand, a low IPI score may lead to limitations on the number of products a seller can list, higher referral fees, and long-term storage fees. To avoid this, it's very important for sellers to stay aware of their IPI score and take steps to improve it.