Amazon Sellers Optimize Warehouse Locations to Cut Costs

Published: 01/05/2026
FBA Location Selection Logistics Optimization Overseas Warehouse
This paper delves into the crucial factors for Amazon FBA warehouse location selection in the US, including regional division, strategies to avoid split shipments, transportation method selection, and the supplementary role of overseas warehouses. It aims to assist sellers in comprehensively considering cost, timeliness, inventory management, and other factors to choose the most suitable FBA warehouses and supporting solutions for their business. The goal is to achieve a balance between efficient logistics and optimized costs.
Amazon Sellers Optimize Warehouse Locations to Cut Costs

Choosing the right Amazon FBA warehouse in the United States is akin to securing a strategic position on an e-commerce chessboard—it directly impacts logistics costs, delivery speed, and inventory turnover. Faced with three primary regions (West Coast, Central, and East Coast), how can sellers make informed decisions about their ideal distribution hub? This analysis breaks down the key considerations for optimal FBA warehouse placement.

Regional Considerations: Balancing Cost, Speed, and Storage

Amazon's U.S. fulfillment network divides into three distinct regions, each with unique advantages:

  • West Coast: Proximity to major ports makes this region ideal for high-volume, long-cycle inventory with the lowest ocean freight costs. Larger warehouse capacities here accommodate sellers with substantial storage needs.
  • Central Region: Offers geographic balance with moderate transit times, serving sellers who prioritize nationwide coverage over extreme cost or speed advantages.
  • East Coast: While inbound shipping costs are highest, this region provides faster access to eastern markets. Best suited for premium products less sensitive to logistics expenses or items with flexible delivery timelines.

Avoiding Split Inventory: Strategies for Consolidated Storage

Distributed inventory across multiple warehouses increases costs and operational complexity. Effective consolidation methods include:

  • Amazon Global Logistics (AGL): While premium-priced, Amazon's official service significantly reduces inventory fragmentation.
  • Inventory Placement Service: Paying Amazon's consolidation fee ensures all stock remains in a single fulfillment center, simplifying management.
  • Consistent Shipment Patterns: Maintaining uniform SKU quantities and product mixes helps Amazon's algorithm assign predictable warehouse locations.

Transportation Methods and Warehouse Selection

Shipping mode directly influences optimal warehouse placement:

  • Ocean Freight (30-45 days): Ideal for cost-sensitive, non-time-critical shipments to West Coast facilities.
  • Air Freight (5-18 days): Faster alternatives for urgent replenishment, with Central or East Coast locations reducing last-mile distances.
  • Express Shipping (3-7 days): Emergency solution only, given prohibitively high costs for regular use.

Third-Party Warehousing: Complementing FBA Operations

External fulfillment partners address critical FBA limitations:

  • Returns Processing: Inspecting, refurbishing, and relabeling returned merchandise before reintroduction to FBA.
  • Buffer Inventory: Pre-positioning stock during peak seasons to prevent fulfillment disruptions.

Operational Optimization Techniques

  • System Integration: Real-time inventory synchronization between management platforms and FBA prevents stockouts.
  • Capacity Monitoring: Tracking Amazon's dynamic storage allocations, particularly in high-availability regions like the West Coast.

Effective FBA warehouse selection requires continuous evaluation of business scale, cost structures, and operational requirements. Sellers who strategically align these factors gain measurable competitive advantages in logistics efficiency and cost management.

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