by spencer kIf you’ve checked your Seller Central settings lately, you may have noticed something: the Amazon FBA Liquidations program is now the default disposition for unsold and returned inventory that doesn’t get resold or fulfilled. Since late 2025, Amazon made liquidation the automatic fallback for sellers who haven’t configured their own removal or disposal settings, and it made donations mandatory on top of it. That means a growing share of sellers are having their excess stock liquidated through Amazon’s own channel without ever actively choosing it — and most never check what that channel actually pays.
What the Amazon FBA Liquidations program actually does
When inventory in an Amazon fulfillment center is flagged as excess, aged, or unfulfillable and isn’t removed, returned to you, or routed elsewhere, it falls into the liquidation queue by default. Amazon doesn’t sell that inventory itself — it wholesales it to a network of third-party liquidation buyers who bid on lots sight-unseen or by category, then resell it downstream through their own channels. You get a payout once the lot sells, minus Amazon’s cut.
It’s a genuinely convenient system if you never touch it: no removal order to place, no boxes showing up at your door, no manifest to build. That convenience is exactly why it’s easy to leave switched on for every SKU without ever running the numbers on what it’s actually costing you.
What sellers are actually recovering
The math is the part that surprises people. Historically, recovery through Amazon’s own liquidation channel has run somewhere in the range of 5% to 10% of a unit’s average selling price — and that’s before fees. On top of the gross recovery amount, Amazon has charged both a processing fee per unit and a referral-style fee taken as a percentage of whatever the lot sold for, so the number that actually lands in your account is smaller than the headline recovery rate suggests.
For a lot of sellers, that’s still better than nothing — inventory that would otherwise sit accumulating storage fees at least turns into some cash and stops the fee clock. But “better than nothing” is a low bar, and it’s worth comparing against what the same inventory is worth to a buyer who’s paying for a full pallet or truckload rather than bidding it down through an anonymous liquidation auction.
Why the default setting matters more than the fee schedule
The fee math is worth knowing, but the bigger issue for most sellers is that they’re in the Amazon FBA Liquidations program at all without having made an active decision about it. If you haven’t gone into Settings > Fulfillment by Amazon > Automated Fulfillment Settings and looked at your Automated Unfulfillable and Automated Removal settings, you likely don’t know which SKUs are currently routing to liquidation, at what threshold, or how much has already gone through that channel this year.
That’s worth fixing regardless of what you decide to do next. Even if you’re comfortable with Amazon’s liquidation program for some categories, you want that to be a choice you made on purpose — not a default you never looked at. Pull your removal and disposition history and see what’s actually been liquidating versus what you assumed was sitting in storage.
When the built-in program makes sense, and when it doesn’t
Amazon’s liquidation program tends to make the most sense for inventory that’s genuinely low-value, hard to resell, or not worth the labor of handling yourself — the stuff you’d otherwise be paying storage fees on indefinitely with no real plan. If the per-unit value is already low, the gap between a 5-10% recovery and a better rate elsewhere is small in absolute dollars, and the convenience wins.
It makes a lot less sense for larger lots of decent-condition inventory: overstock from a bad forecast, discontinued SKUs still in good shape, or customer returns that are cosmetically imperfect but functionally fine. That’s inventory a bulk buyer will actually pay real money for, because they’re buying a known quantity at volume instead of bidding blind on a liquidation lot. If you’ve read our guide on raising your recovery rate when liquidating inventory, the same principle applies here: the more control you have over who’s buying and what they know about the lot, the better the number tends to look.
Opting out isn’t all-or-nothing, either. You can set your own thresholds by SKU or category, routing genuinely low-value stock to Amazon’s liquidation program while pulling higher-value lots out through a removal order and selling them yourself. If you’re already weighing that decision against a removal order, it’s worth reading through what FBA removal orders actually cost before you commit either way, since the removal fee is only the first line item in that comparison.
Getting more than Amazon’s liquidation program pays
The alternative isn’t complicated: instead of letting inventory route into an anonymous liquidation auction, you sell the lot directly to a buyer who’s paying based on what’s actually in the manifest. A buyer purchasing a full pallet or truckload at once doesn’t need to mark it down as far as a liquidator bidding on an unknown mixed lot, because they know what they’re getting before they pay for it.
That’s the gap worth checking before you leave every SKU on autopilot. Pull a manifest of what’s aged, unfulfillable, or sitting past your reorder point, get a number from a bulk buyer, and compare it against what you’ve actually been credited through Amazon’s own channel. If you want a fast read on what a lot is worth outside Amazon’s liquidation program, get an instant quote from Recouply and see the gap for yourself.
FAQ: Amazon FBA Liquidations program
Can I opt out of the Amazon FBA Liquidations program?
Yes. You can opt out at the account level or set different automated disposition rules by SKU or category in Seller Central under your Automated Fulfillable and Automated Unfulfillable settings. Donations became mandatory for eligible items separately from liquidations, so opting out of liquidation doesn’t opt you out of donation eligibility.
Does the program apply to customer returns or only unsold inventory?
Both. Units that come back as customer returns and aren’t eligible for resale can route into the same liquidation queue as excess new inventory that never sold, depending on how your automated settings are configured for each disposition path.
How do I know if I’m currently enrolled?
Check Settings > Fulfillment by Amazon > Automated Fulfillment Settings, then review the Automated Removals and Automated Unfulfillable sections. Your removal order and reimbursement history will also show which units have already gone through liquidation versus other dispositions.