The amazon inventory performance index (IPI) rolled out as a measure for sellers to efficiently manage their inventory on Amazon. Amazon’s IPI measures the health of your inventory in the Amazon network.

Inventory health relates to either having too few or too many units. Having too few units of inventory results in out-of-stock items and lost sales. On the other hand, having too many units of inventory results in excess holding and storage costs.

Amazon’s inventory performance index is a number between 0-1000 that’s used to measure inventory health – capturing low inventory and excess inventory levels for your SKUs.