Inventory Placement

When you are sending inventory to Amazon, Amazon will tell you which of their fulfillment centers to ship to. They can make you divide your shipment into a maximum of three separate shipments. So if you tell Amazon you are sending in 1000 units, Amazon might say to send 300 to Florida, 475 to California, and 225 to Michigan. They do this so your inventory is spread out among their fulfillment center network. This allows Amazon to offer two-day shipping to their customers, since there is always a unit close by. Amazon will continue to shift your units around their network at no charge to you. Amazon knows your sales history, so they will place your units in locations where you're popular.

While this is great for your customers and makes it easier on Amazon, it can be a burden to you. What if you have two pallets of units, but Amazon says to send to three separate locations. Now you have to find another pallet and redistribute all your units. But that's not so bad to compared to the real problem...

When you ship pallets to Amazon, they will send a semi-truck to pick up your pallets. The window they give you is all day, and sometimes they don't even come on the day you requested. So if Amazon divides up your shipment into three separate shipments, now you're waiting for three trucks, all probably coming at different times on different days. Depending on your operation, that can be a serious issue.

There is a way to simplify this process. Amazon offers a service called Inventory Placement. Basically you can say you only want to ship to one fulfillment center. But Amazon will charge you for this, since they have to make the extra effort of sending your inventory to where they actually wanted it to go. So you save time, energy, and shipping costs by only having one shipment. But then you have to pay the fee, which might negate everything and actually be much worse.