What is the Amazon Inbound Placement Fee?

Introduced in 2024, this fee charges sellers for sending inventory to a single warehouse location. Fees range from $0.21 to $0.68 per unit depending on size. You can waive this fee by splitting your shipment into 4+ locations.

How do I avoid the Low-Inventory-Level Fee?

You must maintain more than 28 days of historical supply. This fee applies if both your short-term (30-day) and long-term (90-day) historical days of supply drop below 28 days.

Are returns free for FBA sellers?

No. While Amazon handles the logistics, you pay a 'Returns Processing Fee' for high-return categories (like apparel) and lose the original fulfillment fee. You also often pay for removal or disposal of unsellable units.

5 Hidden Amazon FBA Fees Eating Your Profit (2025 Guide)

Amazon calls it "Fulfillment by Amazon" (FBA), but experienced sellers call it "Fees by Amazon."

Most new sellers calculate profit simply: (Sale Price) - (Product Cost) - (15% Referral Fee) - (FBA Fee) = Profit.

In 2025, that math is dangerously incomplete. Amazon has introduced a complex web of logistical fees designed to penalize inefficient inventory management. These fees don't show up on the product page—they show up weeks later on your transaction report, silently killing your margin.

In this guide, we uncover the five silent killers and give you the exact strategies to dodge them.

1. Inbound Placement Service Fee

What it is: Amazon wants inventory spread across the country to enable 1-Day Prime shipping. In the past, they paid to move your stock around. Now, they charge you.

If you create a shipping plan and send all 1,000 units to a single warehouse (e.g., California), Amazon charges a "Placement Fee" to redistribute those units to New York, Texas, and Florida.

The Cost: Approx $0.21 - $0.68 per unit (depending on size). On 1,000 units, that is $680 lost before you make a single sale.

How to Avoid It: Select the "Distributed Inventory Placement" option when creating your shipment. Amazon will ask you to send stock to 4+ different warehouses. You pay more in shipping to UPS/FedEx, but you pay $0 in Placement Fees. (Usually, the extra shipping cost is lower than the fee).

2. Low-Inventory-Level Fee

What it is: A paradox. Amazon used to penalize you for having too much stock. Now, they penalize you for having too little.

If your product is popular but you constantly run out of stock, it strains Amazon's distribution network. They have to rush-ship units from far away to meet Prime promises.

The Trigger: If your "Historical Days of Supply" drops below 28 days (both short-term and long-term average), you get hit with a fee on every unit shipped.

How to Avoid It: Maintain a buffer stock. Do not let your inventory dip below 4 weeks of cover. If you are about to stock out, raise your price to slow down sales velocity and protect your days-of-supply metric.

3. Aged Inventory Surcharge

What it is: Formerly known as "Long-Term Storage Fees." This fee kicks in much faster than it used to.

If a unit sits in the warehouse for more than 180 days (6 months), the storage fee nearly triples. If it sits for 365 days, it becomes astronomical.

The Trap: Seasonal products. If you send Christmas decor in January and it doesn't sell, you will be paying surcharges all summer.

How to Avoid It:

Aggressive PPC: It is often cheaper to spend money on ads to sell the item at break-even than to pay the storage fee.
Removal Orders: Create an automated removal order for any inventory older than 179 days. Have it sent to a 3rd party warehouse (3PL) or your garage.

4. Returns Processing Fee

What it is: Amazon offers free returns to customers, but they pass the labor cost to you.

This used to apply only to Apparel and Shoes. Now, it applies to High-Return Rate products in any category. If your return rate is higher than the specific threshold for your category, you pay a processing fee for every returned unit.

The Double Whammy: When a customer returns an item:

You lose the sale.
You keep the original FBA fulfillment fee cost (Amazon keeps it).
You pay the Returns Processing Fee.
You often pay a "Removal Fee" to get the broken item back.

How to Avoid It: Improve your product quality and listing accuracy to lower your return rate below the category threshold. (Read our Cost of Returns Guide for more).

5. Unplanned Prep Service Fees

What it is: A fine for being sloppy.

If you send inventory to Amazon and:

The barcode is unreadable.
The box is missing a "Suffocation Warning" label.
The polybag is torn.

Amazon will fix it for you, but they charge a premium "Unplanned Prep" fee (often $1.00 - $2.00 per unit).

How to Avoid It: Be strict with your supplier. Require photos of the barcode and packaging before the goods leave China. If Amazon flags a shipment, acknowledge the error immediately to prevent account suspension.

Summary Checklist

Split Shipments: Send to 4+ locations to waive Placement Fees.
Monitor Stock: Keep 4-8 weeks of inventory to avoid Low-Inventory fees.
Audit Age: Remove anything approaching 180 days old.
Check Prep: Ensure barcodes are scannable before shipping.

Conclusion

Amazon is still the biggest opportunity in e-commerce, but it is no longer "easy money." The margins have tightened.

To win in 2025, you need to be as good at Logistics as you are at Marketing.

Action Step: Open your Amazon Seller Central. Go to Reports > Fulfillment > Inventory Health. Check if you have any "Aged Inventory" approaching 180 days. Deal with it today before the fees hit.

5 Hidden FBA Fees Eating Your Profit in 2025 (And How to Avoid Them)