Have you ever wondered why your Amazon inventory shows as “reserved”? What does it mean for your business when this happens?
If you’re an Amazon seller, it’s important to understand what reserved inventory is and how it can affect your business.
In this article, we’ll explore what a reserved status means on Amazon FBA and exactly what you should do if you’re facing this issue.
What does reserved status mean on Amazon FBA?
Basically, when your FBA inventory is reserved, it means that the inventory is not available for sale at that moment.
And there are a few different reasons why your inventory may become reserved and it doesn’t mean that the seller no longer owns the inventory – it just means that it is being temporarily held by Amazon.
Why are my items ‘Reserved’ on Amazon?
Below are the reasons why your Amazon business may have a “reserved” inventory:
Reserved – Customer Order
One reason why your FBA inventory might be reserved is because of a pending customer order.
This means that a customer has placed an order for one of your products, and Amazon is holding the inventory until the order is processed.
This ensures that the product is available and won’t be sold to anyone else during that time.
Once the order is processed it will be given a future ship date and once the product ships out to the customer, the reserved inventory will be released.
If the customer cancels their order before the product ships out from a fulfillment center then the reserved units will be added back to sellable inventory levels.
Reserved – Fulfillment Center (FC) Transfer
Another reason your inventory might be on reserved status is that Amazon is in the process of transferring some of your stocks from one fulfillment center to a range of other fulfillment centers.
There are several reasons why Amazon puts your inventory on reserved FC transfer status:
- Amazon needs to move your inventory closer to Amazon fulfillment centers that are nearer to your customers to help ensure faster shipping times.
- This also happens whenever there is a stock shortage in one of the Amazon warehouses. Amazon does this to maintain healthy stock levels across the FBA warehouses.
- Lastly, units reserved for FC transfer may be moved to other warehouses where there are more sales.
One thing to note though is that units that have the Reserved FC Transfer status are usually available for sale as a backorder and so they’re not ready for immediate fulfillment.
Reserved – Fulfillment Center (FC) Processing
Many sellers will often see that their inventory is Reserved FC processing when restocking Amazon inventory.
This means that Amazon is currently in the process of receiving and scanning your products at their fulfillment center.
With Reserved FC processing, other units may be required for additional processing entailing verification of item dimensions, authenticity, and weight. And if there are any issues found, additional investigation may be required.
This usually takes a couple of business days to complete. But once the Amazon Fulfillment Center processing is done and the order has been processed and shipped, the inventory will be released into your stock levels.
Now that we understand the different Amazon reserved inventory statuses as well as the reasons behind them, let’s talk about how they can affect your business.
How does Amazon reserved inventory affect your business?
Generally speaking, having some of your inventory reserved by Amazon shouldn’t have too much of an impact on your business if you are able to manage your Amazon reserved inventory levels well.
However, failure to do so can potentially affect your:
Your product’s ranking on Amazon is partially based on how quickly you are able to fulfill customer orders.
If you have a lot of inventory that is “reserved” and not available for immediate fulfillment, it can impact your product detail page conversion rates as customers may be put off by long shipping times.
Lower conversion rates can signal to Amazon that your product may not be as desirable and therefore a reserved quantity of products could cause a decrease in organic ranking.
Customer Satisfaction Rating
Another way that having a lot of reserved inventory can impact your business is by affecting your customer satisfaction rating.
If you have a lot of pending orders because the inventory is “reserved”, it can lead to delays in shipping times which can impact customer satisfaction.
Of course, having a lot of inventory that is “reserved” can also impact your sales because it means that you have less inventory available for purchase.
This can lead to a decrease in customer orders, lost sales, and potentially lower profits.
What should you do about reserved units?
For the most part, you don’t need to do anything about reserved inventory.
It’s just a normal part of the Amazon FBA process and there’s not much you can do to prevent it from happening.
However, there is a way you can mitigate the impact to make sure that you’re never out of stock and that you don’t lose potential customers:
Run a Reserved Inventory Report from your Amazon Seller Central account
To download, simply go to the Menu on the left. Go to Reports > Fulfilment by Amazon > Reserved Inventory.
The inventory report available for download will show you real-time data that will help you keep track of which products are reserved and for what reasons.
This also includes the reserved quantity, as well as the actual number of units you have available.
In this way, even if some of your products have a reserved status, you’ll be prepared and still have enough inventory available for purchase.
Closing thoughts about Amazon inventory management
Inventory management on Amazon FBA can be a bit of a challenge, especially with the Amazon reserved inventory.
Many Amazon sellers like you experience this and although there’s nothing much you can do with reserved inventory itself, it’s important to be aware of the potential problems that can arise from having products on reserve.
By keeping track of it and making sure you have enough available inventory, you will be able to minimize the impact it may have on your Amazon business.
If you want to learn more about the strategies for managing your Amazon inventory effectively and growing a thriving Amazon FBA business, check out our membership options inside Brand Builder University.