Under the historical model of “limited offline warehousing, unlimited online capacity”,, sellers’ concentrated stock preparation and excessive inbound volumes during major promotional events placed significant pressure on warehouse management and shelving efficiency.To help sellers better plan, use, and manage inventory capacity during daily operations and major promotion periods, ensure stable inbound pacing and shelving efficiency, and support smooth commercial operations, we have launched the Capacity Management feature.

How to Use Capacity Management to Manage Capacity Quota

The capacity quota (Quota) allocated to you is the total store-level quota dynamically calculated by the system based on multiple dimensions, such as sales forecasts, historical inbound behavior, replenishment frequency, and historical capacity usage records.

Capacity Management Use Scenarios

Capacity Management consists of the following scenarios: “View”, “Clean Up”, and “Restrict” capacity.

1. View store capacity quota

View current and upcoming effective capacity limits. We will display estimated quotas for the current month and the next three months to help you plan in advance.

2. Clean up inventory occupying capacity quota

You may release occupied capacity by optimizing inventory structure, such as removing slow-moving inventory (Excess Inventory) or canceling unnecessary IBRs.

3. Restrict IBR creation (only when capacity is fully used; controlled starting September 1)

When usage exceeds quota, IBR creation will be restricted or ETA modifications beyond the quota will be restricted.
Scenario 1: View Capacity and UsageScenario 2: Clean Up Inventory Occupying CapacityScenario 3: Capacity Restrictions on IBR Creation

IPS Inventory Performance Score

IPS (Inventory Performance Score) is a metric used to evaluate inventory health across multiple key dimensions.
You can view your IPS score on the FBT system homepage, or go to:
FBT System → Inventory → Inventory Performance Score to view detailed IPS information.
IPS helps you manage inventory more efficiently and identify existing inventory issues, better avoid inventory backlog and stock-out risks, reduce storage costs, and improve sales performance. Sellers with higher IPS scores will receive more capacity, so merchants are strongly advised to monitor the metrics in advance and continuously optimize.
For more details, please refer to Merchant University:
https://scm-us.tiktok.com/merchant-university/course-details/26961594374

IPS Calculation Metrics

IPS is mainly calculated based on the following four metrics. You can improve IPS through continuous optimization in these areas:

Sell-through rate = FBT outbound units sold in the past 30 days / Average FBT inventory units in the past 30 days

• Metric Description: This metric reflects how well your in-stock inventory is selling. Sellers should prioritize placing top-selling SKUs into FBT.
• Optimization Strategy: When selecting products for inbound, prioritize stable, high-performing SKUs to improve this metric.

Excess and aged inventory = Excess inventory units / Total FBT inventory units

• Metric Description: This metric reflects the proportion of slow-moving products in your FBT inventory. Sellers need to actively monitor slow-moving inventory and clean it up promptly.
• Optimization Strategy: You can increase sales of slow-moving items through campaigns, influencer sampling, or increased advertising spend, or clean up slow-moving inventory by creating return orders.

Note: Excess inventory refers to inventory that meets both of the following conditions:1） Longest available inventory age > 90 days; and；2） Turnover days > 90 days or no sales in the past 30 days

Stranded Inventory = (Unmatched SKU inventory units + Defective inventory units) / Total FBT inventory units

• Metric Description: This metric reflects inventory that has remained unmatched or unsellable in FBT for a long period. FBT is a selling warehouse, and sellers may not leave inventory unmatched for extended periods or use FBT as a storage warehouse.
• Optimization Strategy: Reduce unmatched inventory by promptly matching SKUs in the FBT system, and create return orders for defective inventory to clean up unsellable items.

Note: Short-term unmatch and rematch operations will not affect this metric, but long-term unmatched inventory without re-matching is not allowed.

Low Stock Rate = Number of low-stock SKUs / Total FBT SKUs

• Metric Description: This metric reflects the risk of stock-outs for FBT products. Sellers need to monitor stock-out risks and replenish high-selling items in a timely manner.
• Optimization Strategy: View and monitor at-risk products on FBT System → Inventory → Inventory Health, and create inbound orders promptly to reduce stock-out risk.

Note: A product is considered Low Stock when: Inventory turnover days < (10 days + store historical average inbound lead time)

IPS Inventory Performance Incentive Policy： Effective immediately, seller FBT capacity allocation is linked to Inventory Performance Score (IPS)

. Sellers with higher IPS scores can receive additional capacity rewards.
The platform provides additional capacity incentives to sellers with healthy inventory and clearly growing sales.

Incentive Rules

For sellers whose capacity is allocated by the system on the 5th of each month, those who meet all of the following conditions will receive additional quota:

• IPS rating is Excellent
• Sales in the past week increased by more than 50% compared to the previous week

Incentive Display

Frequently Asked Questions (FAQ)

1. How is capacity determined?

The system comprehensively calculates capacity based on sales forecasts, historical inbound frequency, replenishment volume, and capacity usage history. IPS will be incorporated into the calculation logic in the future.

2. What is used capacity?

Used capacity = confirmed-shipment in-transit IBRs + in-warehouse inventory

3. What should I do when capacity is insufficient?

Optimize inventory structure, such as removing slow-moving inventory (Excess Inventory) or canceling unnecessary IBRs.

4. How far in advance can I see allocated capacity?

The current month plus the next three months of estimated capacity will be displayed to help you plan inbound shipments.

5. How often is capacity updated?

Capacity is updated once per month, on the 5th.

6. Will the system notify me when I’m close to the capacity limit?

Yes. The system will issue alerts when you approach or exceed the capacity limit.

7. How can I increase future capacity?

Maintaining good sales performance, improving IPS performance, and effectively using allocated capacity will help increase future allocations.

8. Do new products or seasonal products count toward quota?

It depends on whether the Goods ID is created and successfully matched to a SKU ID. Please ensure new products are created and matched in the FBT system.