#498 - Inventory management is now just as important as PPC management

Built by Business: Amazon FBA, E-Commerce, Brand Building

Andy Isom | Amazon FBA Seller & Agency Founder

Amazon, Business, Amazonfba, Selling, Marketing, Entrepreneurship, Personalbusiness, Productbusiness, Ecommerce, Onlinebusiness

4.9 • 816 Ratings

🗓️ 2 August 2025

⏱️ 10 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Amazon FBA inventory management is no longer a backend task, it’s a profit lever just as vital as PPC. In this episode of Built by Business with Andy Isom, we break down why your inventory strategy directly affects your fees, delivery speeds, conversion rates, and ad performance in 2025.

With Amazon’s latest fee updates, like the low-inventory-level surcharge and storage utilization penalties, mismanaging inventory can kill your margins faster than bad advertising.

We’ll cover:

How Amazon penalizes low inventory and excess storage
What really happens when you go out of stock
The inventory → PPC feedback loop that silently destroys your ACOS
Real tactics to manage inventory smarter in 2025

If you're spending more time optimizing your ads than your inventory, this is your wake-up call.

Request a free brand audit at www.weavos.io

Transcript

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0:00.0	Everyone's obsessing over their PPC performance or ACOS. Meanwhile, their bleeding profit on
0:07.1	back-end inventory fees and stockouts. In 2025, inventory management is just as important as PPC
0:15.1	management. When people think of growing their Amazon brand, they think PPC, they think branding,
0:28.5	they think creatives.
0:30.3	But what's silently eating into profits more than anything else right now is poor inventory
0:35.9	management. Amazon has quietly made inventory the new profit lever.
0:40.3	The Amazon fee stack in 2025 has changed the game.
0:44.3	We now have an aged inventory surcharge for inventory that has been sitting in FBA warehouses for too long.
0:51.3	We have a storage utilization surcharge or a fee based on how quickly
0:56.3	or slowly you move your inventory. There's an inbound placement service fee, which is dependent
1:01.7	on where you choose to ship your inbound FBA inventory. There was even a low-level inventory
1:07.9	fee introduced in April of 2024, which penalizes sellers for not having enough inventory.
1:15.3	And these aren't small fees.
1:17.4	When stacked, they can double your cost to fulfill an order.
1:21.3	Amazon is, quote, sending a clear message.
1:24.6	If your inventory sits or runs out, you'll pay for it." End quote, from our friends
1:29.8	over at Marketplace Pulse. First, let's talk about what happens when you go out of stock.
1:35.9	The short-term damage of running out of inventory is that you lose the buy box or you get
1:40.6	suppressed. If you're out of inventory of a specific skew, you're not going to show up in the
1:45.0	search results. Another short-term damage of running out of inventory is that the delivery time
1:50.3	increases, which can lead to lower conversion rates. I actually had an interesting consulting call
1:55.5	with one of my Wevos clients, and we were looking at some up and down sales over the past couple
	...

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