What’s An Amazon FNSKU? How To Create An FNSKU For FBA Sellers?

Executive Summary

What’s an Amazon FNSKU? How to Create an FNSKU for FBA Sellers
1. What is an Amazon FNSKU?: Fulfillment Network Stock Keeping Unit (FNSKU) is a unique term used on barcodes to identify products of FBA sellers. Sellers get a unique FNSKU for every product they sell, even if other sellers have the same ASIN. 
2. Difference Between FNSKU and ASIN: Many sellers can use the same ASIN if they sell the same product. In contrast, each seller gets a different FNSKU for the product they send to the fulfillment center.
3. How Can I Create an FNSKU?: Log in to Seller Central and navigate to the settings drop-down option. In the drop-down menu, select fulfillment by Amazon. Keep scrolling until you see FBA Product Barcode Preference, and click edit. After that, select the Amazon barcode and click update. Select Manage FBA Inventory and upload the product for which you want the FSKU. Upload the product listing, and go back to Manage FBA Inventory to see your FNSKU.
4. How to Print FNSKUs?: Log in to Seller Central and choose the Manage Inventory option. After that, select the product for which you want to print the FNSKU labels. Click on Print Item Labels, and adjust the label size and settings per your preference. The next step is to print the labels.

Lastly, stick the labels onto the packaging of every product that goes into the Amazon warehouse. If you do not place the FNSKU label, your product will never make it to the buyer. 

5. Is FNSKU Better than a UPC?: Hundreds of sellers use the same product from the same manufacturer. So, they all have the same UPC, but Amazon assigns unique FNSKUs to every seller. It means FNSKU is better than a UPC.
6. Why Do I Need FNSKUs?: FBA sellers need FNSKUs to fight against counterfeiting, and it also helps in managing inventory.

 

Amazon sellers are often overwhelmed by confusing terminologies and abbreviations. It is hard enough to create an Amazon product listing without having to understand these terms. ASIN, UPC, FNSKU, what do they all mean? Why do you need to learn about all of these terms? Most sellers assume these are the same product identification terms and do not serve any unique purpose. However, the truth cannot be further than this assumption. Amazon FNSKU is entirely different from ASIN and UPC. It is a unique identifier that connects Amazon FBA sellers to their products. Our guide will teach you everything about FNSKUs.

 

     Read More: What Is The Best Funding Option To Scale Your FBA Business?

 

What is Amazon FNSKU?

Fulfillment Network Stock Keeping Unit (FNSKU) is a unique barcode that identifies the products of FBA sellers. It is slightly similar to ASIN and UPCs, but every seller has a different Amazon FNSKU for every product. The fulfillment process becomes much easier if a product has an FNSKU. After a buyer places an order, Amazon can easily find the right product through this unique barcode. More importantly, Amazon FBA sellers can track their products in transit. FNSKUs provide complete transparency to sellers and make it easier to manage the inventory. 

In many cases, Amazon demands that FBA sellers put FNSKU barcodes on their products. ASINs with multiple sellers cause a severe problem for the warehouse staff as these products have the same universal product codes for amazon. Therefore, a unique identification code or number is necessary for finding the specific product.

 

Difference Between ASIN & FNSKU

 

Here is the explanation for everything from ASIN to UPC.

ASIN, FNSKU, and UPC can get a little confusing for most people. What is the reason for different codes and labels? Do they all mean the same thing? No, Amazon ASIN is a product identifier, and every product on Amazon has an ASIN. The problem with ASINs is that multiple sellers can associate themselves with the same product. As a result, Amazon can not differentiate between sellers of the same product. 


FNSKUs are unique and remove any confusion at the warehouse. Every seller gets a different FNSKU for each product. As a result, even products with the same ASINs have different FNSKUs. It allows Amazon to connect every product to a specific seller. Therefore, buyers do not receive products from the wrong sellers. It makes a significant difference in customer perceptions. Imagine that you order a product from a specific seller but receive a faulty one from another Amazon seller. You would blame the seller you chose. So, FNSKU helps Amazon sellers to distinguish their products with a unique marking.

 

                                                          Read More: Amazon Advertising: ASIN Retargeting Explained

How Can I Create An FNSKU? 

Creating an FNSKU only takes a few minutes. Let us guide you through the process of creating an FNSKU. Please be advised that it will only work if you are an FBA seller. 

  1. Log in to Amazon Seller Central and navigate to the settings drop-down option.
  2. In the drop-down menu, select fulfillment by Amazon.
  3. Keep scrolling until you see FBA Product Barcode Preference, and click edit (see the image below for reference)
  4. Select Amazon barcode and click update.
  5. Open the inventory drop-down menu, and select Manage FBA Inventory.
  6. Upload the product for which you want to create the FNSKU.
  7. After you create the listing, go back to Manage FBA Inventory and viola! Your product would be there with its newly created FNSKU.

Follow these steps to create FNSKUs for your products.

 

How to Print FNSKUs?

Okay, you created the FNSKU now, but you also need to put it in your products. Follow these steps to print your FNSKU labels. 

  1. Log in to Amazon Seller Central and choose the Manage Inventory option.
  2. Select the product for which you want to print the FNSKU labels.
  3. Click on Print Item Labels.
  4. Adjust the label size and other settings as per your preference. After that, print the labels.
  5. Stick the labels onto the packaging of every product that goes into the Amazon warehouse. If you do not place the FNSKU label, your product will never make it to the buyer. 

Creating an FNSKU is good, but it will not do anything for you if you do not post these codes on your products. It gets slightly complex from here because most FBA sellers never get to see their products. Third-party manufacturers send the product to the Amazon warehouse. Talk to your supplier or manufacturer and explain that you want to place these labels on the packaging. FNSKU registration and printing are worthless if your manufacturer does not stick these labels on your product. So, talk to them and explain that you want these labels to be your product packaging.

Most FBA sellers send the label design to manufacturers and ask them to stick the FNSKU label onto the packaging. You can also do it yourself if your products do not come from a foreign third-party supplier. So, a few simple steps can give you an advantage on Amazon. There are plenty of ways of sticking the labels on the packaging, but you need to choose the one that fits you the best.

 

Is FNSKU Better than a UPC? 

Amazon UPC is just a generic code that does not help to identify seller-specific products. Dozens or hundreds of sellers may use the same manufacturer for their products. As a result, all of the products will have the same UPC as they are the same. It creates needless confusion and makes things difficult for the warehouse staff. More importantly, it increases the chances of delivering the wrong products to customers. Therefore, Amazon UPC can only identify a product, but it cannot pinpoint the seller of the product.

We strongly advise FBA sellers to switch to FNSKUs. These unique codes will help you to manage inventory much better than UPC codes for Amazon. Buyers will never receive the wrong product when they buy from you. It will help you to increase customer satisfaction while decreasing the chances of misdeliveries. If you have not made the switch to FNSKUs, you should look into it.

 

                                                            Read More: Amazon Dropshipping: Product Research

 

Why Do I Need FNSKUs?

Items without FNSKUs are commingled with products of the same ASIN. As a result, the fulfillment center cannot differentiate between your products and other products that have the same ASIN and UPC

Let us run a hypothetical scenario where the Amazon fulfillment center cannot find your product:

Your product arrives at the Amazon fulfillment center without an FNSKU. As a result, they are mingled with products with the same UPC and ASIN. A buyer comes to your Amazon product listing and places an order. The fulfillment cannot find your particular product as it has no unique marking. So, they pick a product with the same UPC as your product. The buyer receives the product, and it is not in good condition. They will leave a bad review on your listing even though they received a product from a different seller. FNSKUs will help you to avoid this entire scenario.  

FNSKU is also your weapon against counterfeiting. Fraudulent sellers cannot mingle their products in between your products. You will also have better control over your inventory. Overall, FNSKUs have too many benefits, and you should not ignore these benefits as an FBA seller. Take full advantage of the Amazon barcode. FNSKUs might be slightly frustrating to print and label packaging, but the pros outweigh the cons.

Conclusion

We hope that you will consider using FNSKU labels from now on. FBA sellers must give their products a unique identity, so others cannot counterfeit products. More importantly, fraudulent sellers will think twice about copying your product. Hopefully, you have learned the difference between all of the product identifiers. FNSKU is like a product + seller identifier, which makes it different from Amazon ASIN and UPC. Therefore, you should start using Amazon FNSKU to separate your products from others in the fulfillment process.

Don’t Get Stuck Sitting on Inventory: Improve Your Amazon IPI Score

Sellers cannot just throw unlimited items in the Amazon fulfillment center with hopes of selling all the stock. Inventory management is an essential part of a successful FBA business. You pay through the nose if you keep too many items in the fulfillment center. The Amazon IPI score shows how efficiently you manage your inventory. Amazon rewards high scores and implements restrictions on low-scoring sellers. They know their space is valuable, and storing stranded inventory will hurt their business. You need to learn all the tricks to avoid a low IPI score, and we cover all of these tricks in our blog!

Read More: Amazon Inventory Management Tips to Get You Started

 

Don’t Get Stuck Sitting on Inventory: Improve Your Amazon IPI Score
1. Amazon IPI Score: The IPI score measures the efficiency and productivity of inventory management. Higher scores indicate better inventory management. 
2. Where to Check My IPI Score: Log in to Seller Central and click on Inventory.

  • In the drop-down menu, select Inventory Planning.
  • Click the Performance tab, and it will show you your IPI score.
3. How Amazon Calculates IPI Score: The formula is undisclosed, but Amazon most likely uses the sell-through rate to calculate the IPI score. 
4. Amazon IPI Threshold: 

IPI Score Above 450: Average

IPI Score Above 550: Excellent

IPI Score Below 350: Additional Storage Fees & Storage Restrictions

5. How to Improve My IPI Score: Improve your sell-through rate, avoid excess inventory, and create removal orders for stranded inventory.
6. Additional Tips to Improve IPI Score: Use PPC advertising, pricing strategies, removal orders, and listing optimization to improve your IPI score. 

 

Amazon IPI Score

The Amazon IPI score measures the efficiency and productivity of your Amazon FBA inventory management. It ranges from 1 to 1000; higher scores indicate excellent management, while lower scores indicate poor inventory management. Therefore, sellers should aim to get a high score because it gives them several advantages. Amazon FBA sellers who efficiently manage inventory receive several privileges. Moreover, efficient inventory management is a sign of a prospering business. Minimal bottlenecks and productive inventory turnover also show that the product sells quickly. Sellers cannot overstock or understock the inventory and must find the perfect balance to achieve a great IPI score.

Where to Check My IPI Score?

You can check your Amazon Inventory Performance Index score in three simple steps. Follow the instructions given below to find your IPI score.

  • Log in to Amazon Seller Central and click on Inventory.
  • In the drop-down menu, select Inventory Planning.
  • Click the Performance tab, and it will show you your IPI score.

Now, you might either get disappointed or happy after seeing your score. Either way, you can still take many actions to improve your score. The most important thing you should know is that IPI scores are not static and keep changing based on your previous three months of performance. If you keep improving your inventory management, your IPI score will keep improving. Do not despair and get to work even if your score is poor! Let us show you how to correct your IPI score.

 

How Does Amazon Calculate IPI?

Amazon has not disclosed the Inventory Performance Index calculation formula, making it even more complex to understand the IPI score. The organization is secretive and does not want to reveal its algorithms and ranking mechanisms. Amazon has assured sellers that the IPI score does not decrease if a seller runs out of stock. However, stranded inventory decreases the IPI score, as your items are stuck in the warehouse. It means that out-of-stock items represent missed opportunities, but stranded inventory is the death of your IPI score. Study the demand for your product, and do not fill up the fulfillment center with excess inventory. 


The sell-through rate is another factor that affects the Amazon Inventory Performance Index score. It refers to the number of units sold and shipped in the last three months divided by the number of units still in the inventory (see the image below for reference). The percentage shows how much stock was on hand in the past 30 days. A low sell-through rate means your items are not selling and are just sitting in the warehouse. As a result, your products are occupying needless space in the Amazon fulfillment center.

 

Amazon IPI Threshold

Amazon FBA sellers must meet the minimum IPI threshold to avoid penalty fees and restrictions. Extra storage costs can prove detrimental to your business if you are not careful. According to Amazon, an IPI score above 450 is the average score. Every seller should be near this score, but falling below 350 leads to additional fees and storage costs. Moreover, you can only send a limited number of units to the fulfillment center. Avoid going below 350 at any price, and do whatever you can to raise your score. An IPI score of 550 and above indicates your inventory management is excellent. Aim for this score if your Amazon FBA inventory management is currently above 450. 

IPI Score Above 450: Average

IPI Score Above 550: Excellent

IPI Score Below 350: Additional Storage Fees & Storage Restrictions

 

How to Improve My IPI Score?

What can sellers do to improve their IPI score? We have compiled a list of recommendations that can improve your score. Follow these recommendations as much as possible, and the IPI score will rise.

 

Avoid Excess Inventory

Amazon aims to make the best use of its warehouse space and does not tolerate excess inventory. Be careful and never send too many units to the fulfillment center. When your FBA stock exceeds a 90-day supply, Amazon terms your item as excess or overstock, meaning you have sent the unnecessary stock to the warehouse. 

The best practice is to maintain an inventory of 30-60 days. Keeping a low stock has no lasting disadvantages, but you may miss out on sales opportunities if your product runs out of stock. However, running out of stock is much better than paying extra storage fees to Amazon and incurring storage restrictions. Thus, keep a small inventory in the fulfillment center and never ignore your supply and demand statistics. Only increase the stock if the demand is projected to rise shortly.

 

Improve FBA Sell-Through Rate

The sell-through rate is the number of units shipped in the past 90 days divided by the number of units still in inventory.

The sell-through rate depends on the duration the products stay in inventory. Think of the 90–day-sell-through rate as your salvation. It means that your stock is clearing out in 90 days, so you are not consuming unnecessary space in the fulfillment center. Most importantly, the 90-day-sell-through rate will keep the IPI score in the green graph, which is your ultimate goal. 

Amazon Seller Central also gives helpful recommendations to improve the sell-through rate. Go to the inventory dashboard and click “improve sell-through” to see the suggestions. Amazon wants to help you turn over your inventory in a short time. So, follow their advice and try to consider all of their recommendations.

A last-ditched method to improve the sell-through rate is decreasing product prices. Run a promotion and sell your products at low prices to clear out your entire inventory. It might save you from excess inventory but will decrease your profit margins.

 

Stranded Inventory

Stranded inventory is the biggest nightmare of any FBA seller. Imagine you sourced a new product and were expecting high demand for the product. So, you sent 30-60 worth of stock to the fulfillment center. However, there was a problem with the Amazon product listing, and it went down for some reason. Do not just take this as a hypothetical situation because it is a realistic situation on Amazon. Listings get banned for several reasons, and you cannot do anything about it. As a result, your inventory is stuck in the warehouse. No items are being offered, and the stock is just taking space in the fulfillment center. You must create a removal order to get rid of the stranded inventory.

If stranded inventory sits in the fulfillment center for 365 days, you will have to pay long-term storage costs. Draft a removal order as soon as possible to remove the stranded stock. Another option is to activate the Amazon product listing if possible, but you will need to clear out the inventory quickly. Stranded inventory severely lowers the IPI score and is harmful to the business. The inactive stock serves no purpose and only consumes precious resources. So, ditch the stranded inventory on the first chance you get.

 

In-Stock Inventory

Being out of stock does not decrease your IPI score, but it is a missed opportunity to improve. It means you are missing out on sales opportunities that can increase your sell-through rate. Amazon also calculates the estimated number of orders you missed due to out-of-stock status. Continuously missing out on sales also indicates inventory mismanagement. Do not be overcautious, and keep your most popular ASINs well-stocked. Use forecasting tools and other methods to track the demand for your product. 

Are you working with seasonal products? If yes, mark your ASIN as non-replenishable in the restock inventory. Seasonal products often sell out in a few weeks. However, you might be stuck with these items when the season finishes. Create a removal order to remove any leftover seasonal products after the season is finished.

 

Additional Tips to Improve IPI Score

Here are some additional tips that can help you to improve your IPI score.

Advertising

Amazon PPC advertisement is a great way to increase your sales. Higher sales translate to a high IPI score because you are clearing the inventory at a high rate. Active advertisement is also much more effective if your product rank is not that good. Advertise to the audience and do not wait for them to search for your product, which might not even pop up due to poor product rank.

Pricing

A competitive pricing strategy always increases sales, and you may have seen countless sellers running offers on their products. Do not decrease the price too much if your products are already making a healthy revenue.

Removal Orders

As we mentioned above, create removal orders to remove dormant inventory that is not making any profit. You cannot afford to let these items sit in the warehouse for long.

Time Shipments to the Fulfillment Center

Time your shipments well and always maintain a 30-60 day stock. Avoiding a low IPI score does not mean that you should continually run out of stock. Maintain a smaller inventory, but keep it stocked to avoid missing out on sales. 

Improve Product Listing

Amazon listing optimization can help you to clear out your inventory. It helps to attract relevant traffic to the Amazon listing and increases conversions. Optimize all your product listings to increase sales velocity and frequency. Find the best Amazon listing optimization service to improve your product sales.

Conclusion

Swift and efficient inventory management are essential for making a profit on Amazon. You will be stuck paying storage fees forever unless you improve inventory management. Learning about the IPI score and using different tricks to improve your sales will help your IPI score. Moreover, these methods will help you to be more efficient. You will only pay the minimal Amazon FBA fees if you have a decent inventory turnover. Do everything you can to get in the green IPI rating, as it will help you to gain several advantages. Remember the lesson; stuck inventory equals financial losses.