Over the last 12 months, many sellers have been hit with rising FBA placement fees, especially those shipping between 500 and 4,000 units in a single shipment. If you are sending inventory to multiple fulfillment centers—sometimes up to five locations—you have likely seen costs ranging from $80 to $580 per placement.
For sellers shipping only 100 units per month, this may not be a major concern. But for brands moving 1,200 to 5,000 units monthly, these fees add up quickly, cutting into margins and creating operational challenges.
Meet Amazon AWD — discover more below 👇
Amazon’s Strategy: Placement Fees & AWD
When Amazon introduced placement fees, it also increased promotion of Amazon Warehousing & Distribution (AWD). Coincidence? We do not think so. At David Ricardo, we believe this was a strategic move to encourage sellers to transition into AWD.
For our clients, we have done detailed cost analyses and found that AWD can significantly reduce expenses by:
✅ Reducing placement fees
✅ Using Amazon’s logistics network instead of relying entirely on a 3PL
How to Maximize Savings with AWD 🛠️
To make AWD work effectively, follow these key strategies:
✔️ Use UPCs instead of FNSKUs — this helps avoid relabeling costs.
✔️ Ship in master cartons — consolidate units to make shipping more efficient.
✔️ Use Amazon Logistics for pickup — using your own carrier may trigger inbound AWD fees.
✔️ Ship directly from China to AWD — this can simplify supply chain management, though you still need to watch duties and product classifications.
✔️ Automate AWD-to-FBA transfers — Amazon offers an AWD setting that allows inventory to move automatically from AWD to FBA.
What Happens After Your Inventory Arrives at AWD?
Once your inventory reaches AWD, you have two options:
1️⃣ Send inventory to FBA for standard Amazon fulfillment.
2️⃣ Ship master cartons (case packs) directly to businesses for bulk sales outside of Amazon.
Below is a screenshot to help illustrate the process.
Understanding AWD Storage Costs 💰
Let’s talk numbers. For 1,200 units (about 1.8 cubic meters), storage costs are around $29.99 per month. Your exact AWD costs can be found in the AWD Cost Report inside Amazon Seller Central.
Final Takeaway
If you are shipping 3,000+ units or managing more than 5 pallets of inventory, AWD is worth considering. The savings on placement fees, combined with Amazon’s logistics support, can streamline your supply chain and improve profitability.
Plan for Prime Day Now! 📅
Prime Day is only a few months away. Plan ahead and inbound early into Amazon Warehousing and Distribution (AWD) using Ship to AWD. Inventory received in AWD by May 15 will be positioned to become Prime-badge ready in time for Prime Day.
Use the Ship to AWD low-cost bulk storage solution to simplify your cross-border transportation, storage, and automatic replenishment into Amazon fulfillment centers—from China to the U.S.
📢 If you need support, visit GetRicardo.com