Imagine carefully preparing a shipment of goods, intended for delivery to a single FBA warehouse, only to have Amazon's system distribute it across multiple facilities. This scenario not only complicates initial transportation logistics and increases costs but also creates inventory management chaos. For Amazon sellers, this represents an operational nightmare. The solution? Amazon inventory locking.
Understanding Amazon FBA Inventory Locking
Amazon FBA inventory locking, as the name suggests, allows sellers to designate specific fulfillment centers for their shipments, preventing automatic distribution across multiple warehouses. This strategic approach enables sellers to precisely control inventory flow, optimize logistics strategies, reduce costs, and improve operational efficiency.
The Benefits: Cost Reduction and Operational Simplification
While not universally applicable, inventory locking offers significant advantages for specific seller profiles and product categories:
- Reduced initial transportation costs: Consolidating shipments to a single warehouse minimizes the additional expenses caused by distribution across multiple facilities. This proves particularly valuable for large or specialized items requiring unique handling.
- Simplified inventory management: Single-warehouse storage provides clearer inventory visibility, reducing risks of overstocking or shortages while facilitating easier stocktaking and returns processing.
- Optimized logistics strategy: Sellers can select the most appropriate warehouse based on product characteristics and shipping methods, enhancing overall supply chain efficiency.
- Improved operational focus: Eliminating the complexities of distributed inventory allows sellers to redirect resources toward product development and marketing initiatives.
Potential Limitations
Inventory locking does present certain constraints that sellers should consider:
- Possible increase in final delivery costs: If the designated warehouse is geographically distant from customer concentrations, last-mile delivery expenses may rise.
- Potential impact on sales velocity: Limited warehouse coverage could affect product visibility and sales performance in certain markets.
- Eligibility requirements: Amazon imposes qualification criteria based on seller standing and product categories.
Ideal Product Candidates for Inventory Locking
This strategy proves particularly effective for:
- Oversized items: High transportation costs make consolidated shipping economically advantageous.
- Heavy goods: Similar to oversized products, weight-based shipping charges favor single-location fulfillment.
- Special-handling products: Fragile, liquid, or battery-containing items benefit from reduced handling points.
- Seasonal merchandise: Demand concentration makes centralized inventory management preferable.
- High-value products: Minimizing transit points reduces loss and damage risks for premium items.
Implementation Methods
Amazon currently offers two primary inventory locking solutions:
1. Amazon Global Logistics (AGL):
AGL enables direct shipment from seller warehouses to specified FBA locations, currently supporting three U.S. facilities (ONT8, MDW5, SDF8) via ocean (FCL/LCL) and air freight options.
2. Amazon Dragon Boat Program:
This China-focused solution provides comprehensive logistics services including storage, packaging, and international transportation to FBA facilities, though it exclusively handles containerized shipments.
Operational Process for AGL Inventory Locking
The implementation process involves several key steps:
- Registration on Amazon's booking system with required documentation
- Electronic contract execution
- Permission activation
- Ocean freight account setup
- U.S. customs bond and power of attorney procurement
The shipping workflow encompasses Amazon backend operations (inventory planning, labeling), freight system ordering (cost calculation, documentation), and shipment execution with either self-handled or agent-managed customs clearance.
Transit typically involves approximately seven days from warehouse arrival to vessel departure, with one-month ocean transit followed by customs processing.
Strategic Considerations
Amazon FBA inventory locking represents a powerful operational tool when aligned with appropriate product categories and business objectives. Sellers must carefully evaluate their specific circumstances—including product characteristics, logistical requirements, and sales targets—to determine whether centralized fulfillment will deliver meaningful efficiency gains and cost reductions.