Like much of Amazon’s business, inbounding inventory has undergone a lot of recent changes. In Amazon’s quest to rapidly ship inventory across the entire country, placement of products has become increasingly critical to fulfilling Prime obligations and reducing overhead.

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When your inventory is sent to a single location, Amazon has to then distribute inventory throughout their fulfillment centers.  Some sellers will constantly see large quantities of inventory in ‘FC Transfer’, which is inventory being shuffled between fulfillment centers to be closer to customers.

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Historically, Amazon has just moved products through their network at their own expense, but over the last few years Amazon has taken steps to incentivize sellers to split their inventory shipments.

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Inbound Placement Service is a new feature in the Send to Amazon workflow.  This provides many options to sellers to essentially trade ease of shipment for additional fees.  The more work a seller is willing to do, the less Amazon will charge them to move the inventory later. These fees also scale with product size and weight. Larger products, larger fees.

As you can see here, in addition to selecting Small Parcel Delivery or LTL, the seller also has the option to select 5, 3, or 1 shipment. The number of shipments may vary. In addition, they also have the ability to inbound to a certain region, with variable pricing depending on where the customer base is located, as well as where inventory is shipped from.

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Looking at this shipment, we end up with a LOT of different options, broken down in the table below.  Note that the inbound shipping region section is in addition to the shipping rate at the bottom of the screen, which will change based on location.

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We can see from above, that by far the cheapest shipping option is sending the maximum number of shipments, regardless of shipping mode. For this example shipment of 7,200 units of relatively small product, the savings is nearly $600 on LTL, and nearly $1,000 on Small Parcel.

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We would highly recommend sending units via the Amazon optimized shipping splits!  You’ll save not only money, but time, by having your inventory available to customers sooner.

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However, this isn’t always possible, as seen from the example below:

This example shipment is for 190 units.  7 boxes, each with a different SKU.  This is a pretty typical shipment using case pack templates, which is very common for Amazon sellers, as entering box contents is quite tedious.

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This shipment doesn’t have the option to split, because splitting this shipment doesn’t achieve anything from Amazon’s perspective. Since all the units in each box are the same, and there’s only 1 box of each, splitting them does no good. Amazon would simply have to ship half of box 1 to fulfillment center B, and half of box 2 to fulfillment center A to distribute inventory. 

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If you’re sending smaller shipments, with only a single box of each product, it may make sense to split products between boxes, otherwise you may see your shipping rates essentially double as Amazon passes on these placement fees. Alternatively, you can ship more units in, allowing Amazon to split the inventory, or split your case packs down to smaller boxes so that they can be split to different locations.

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For more information about how placement fees are assessed, you can visit the 2024 FBA inbound placement service fee page.