How Do Amazon FBA Locations Impact Shipping and Costs?

As eCommerce continues to dominate the global retail landscape, sellers on Amazon are focusing more than ever on logistics efficiency. The most overlooked yet strategically vital factor? The location of your fulfillment centers—specifically, Amazon FBA locations.

With over 175 fulfillment centers globally and a logistics empire that rivals FedEx and UPS, Amazon has created a vast network that shapes everything from delivery speed to your bottom line. Yet, many sellers underestimate how these locations can dramatically impact shipping costs, inventory strategy, customer experience, and ultimately profitability.

In this guide, we’ll explore how fulfillment center locations influence costs and performance, and how sellers can optimize their logistics approach accordingly.

Understanding the Amazon FBA Network

Fulfillment by Amazon (FBA) allows sellers to store inventory in Amazon’s warehouses. Amazon then picks, packs, ships, and handles returns for those products. It’s a turnkey solution for eCommerce sellers—but that doesn’t mean it’s hands-off when it comes to strategy.

The key to understanding cost structure lies in understanding how Amazon allocates your inventory across its FBA locations.

Amazon decides where your products go—based on demand forecasting, warehouse availability, and service-level goals. However, you can influence this through your shipment strategy, warehousing partnerships, and SKU-level analysis.

1. Shipping Costs Start Before the Customer Clicks “Buy”

Many sellers believe that shipping costs are just about what customers pay at checkout. In reality, the cost journey begins the moment you send inventory to Amazon’s fulfillment centers.

A. Inbound Shipping to FBA

Shipping inventory from your supplier or prep center to Amazon FBA locations varies dramatically based on distance, regional constraints, and the FBA warehouse assignments Amazon provides.

If your inventory is coming from China and Amazon assigns you to send inventory to multiple locations across the U.S., your freight and domestic shipping costs can skyrocket.

What you need to consider:

• The further the FBA location from your supplier or U.S. port, the higher the domestic freight costs.
• Amazon may require you to split shipments across multiple fulfillment centers unless you use inventory placement service (which incurs fees).
  

Optimizing Tip: Work with a 3PL close to major Amazon FBA locations such as Moreno Valley (California), Dallas (Texas), or Edison (New Jersey) to reduce last-mile shipping costs.

B. Inventory Placement Strategy

Amazon allows sellers to opt for its Inventory Placement Service (IPS), which lets you send all inventory to a single location. Amazon then redistributes it internally across its network.

This is useful if you want to save on multi-destination shipping costs. But there’s a catch—it comes with a per-unit fee, and Amazon may still split your shipment based on product category or size tier.

Decision Point:
If your products are heavy, large, or shipped in small volumes, the fee may outweigh the benefit. However, high-volume sellers often find this cost-effective for operational simplicity.

2. Regional Demand vs. Storage Optimization

Not all Amazon FBA locations serve the same purpose. Some are storage-focused, while others are fulfillment-optimized.

A. Storage-Focused Warehouses

These are typically located farther from urban centers and are designed to store large volumes of inventory for longer periods.

Pros:

• Often have lower storage fees.
• Can hold overflow inventory, especially during peak seasons.

Cons:

• Products stored here may take longer to reach customers.
• May require Amazon to transfer units to another center before delivery.

B. Fulfillment-Optimized Warehouses

These are located near major population hubs and designed for speed. They handle fast-moving SKUs that need quick turnaround.

Pros:

• Faster Prime delivery = better customer experience.
• Higher chances of winning the Buy Box.

Cons:

• Higher storage fees due to prime real estate and faster turnover requirements.

Smart sellers plan their inventory to live across both types of centers—using storage facilities for long-term stock and fulfillment hubs for high-demand products.

3. Customer Delivery Speed and Prime Coverage

Amazon’s promise of one- or two-day delivery depends heavily on proximity to the end customer. This means where your product is stored affects how quickly it can be delivered—and whether or not it qualifies for fast Prime shipping.

Key Insight:
The closer your product is to high-demand urban areas, the lower the delivery cost for Amazon. These savings often translate into higher visibility in search results and faster delivery estimates.

FBA locations on the East and West Coasts are critical for covering massive population zones. If your inventory is not near these areas, your products may show longer delivery estimates—hurting conversion rates.

4. Storage Costs by Season and Geography

Amazon FBA storage fees are not fixed—they fluctuate by season, product size, and warehouse availability.

High-demand seasons such as Q4 often come with significantly higher storage costs, especially for standard-size products stored in fulfillment-optimized locations.

What to track:

• Monthly storage fees (calculated by cubic foot)
• Long-term storage fees (applied to items stored 181+ days)
• Seasonal rate hikes (typically October–December)

If your SKUs are slow-moving, being stored in high-turnover FBA locations can drain your margins.

Cost-Control Tactic:
Use a third-party logistics provider to hold excess inventory and drip-feed stock into Amazon FBA as needed. This minimizes high storage fees while maintaining availability.

5. Returns and Reverse Logistics

FBA also handles customer returns, and this is where Reverse Logistics becomes a critical part of your inventory strategy. The location where a product is stored or returned can significantly affect how quickly and affordably it’s processed and restocked.

FBA locations in central regions like Tennessee or Indiana often serve as return hubs. These centers specialize in Reverse Logistics—evaluating returned products and restocking them if they’re in sellable condition. When your product is returned and processed at one of these strategically located hubs, it can be back online and available for purchase much faster.

Why it matters:

• If your product is restocked quickly in a prime location, it’s back in front of customers faster.
• Returned to a non-fulfillment-focused or remote center? You could face delays in restocking or even additional shipping to another fulfillment center.
• Inventory velocity plays a major role. Fast-moving SKUs benefit from quick restocking through efficient Reverse Logistics, while slow movers risk getting stuck in processing limbo.

Optimizing your return flow through Reverse Logistics ensures better inventory health, improved sales continuity, and ultimately, happier customers.

6. Multi-Channel Fulfillment (MCF) Implications

If you sell on Shopify, Walmart, or other platforms and use Amazon for order fulfillment, your FBA locations impact your shipping cost to those non-Amazon customers too.

For example:
An order placed on your DTC website by a customer in Florida will be fulfilled faster (and cheaper) if your inventory is stored in Amazon’s Jacksonville or Lakeland facilities compared to a facility in California.

Amazon calculates MCF rates based on fulfillment center proximity, size, and service level. Strategic inventory placement improves speed and reduces per-order MCF fees.

7. International Seller Considerations

If you’re a seller outside the United States shipping to Amazon’s North American fulfillment network, FBA location assignments can determine import duties, lead times, and customs complexity.

For example:
Canadian sellers shipping into the U.S. FBA network might receive multiple warehouse assignments that increase costs due to cross-border fees and multiple customs entries.

Solution:
Use a U.S.-based freight partner with consolidation options to handle imports and distribute inventory efficiently across the fulfillment network.

Final Thoughts: Location is Leverage

Understanding how Amazon FBA locations impact your costs isn’t just logistics knowledge—it’s strategic leverage. Sellers who align their shipping, storage, and inventory strategies with the geography of Amazon’s network consistently reduce costs, increase delivery speed, and improve their customer experience.

To recap:

• Inbound freight is affected by assigned FBA locations
• Inventory placement services can simplify or complicate shipments
• Strategic storage decisions reduce fees and increase sell-through
• Prime coverage depends on fulfillment proximity
• Return logistics and MCF efficiency are tied to warehouse location

Smart sellers treat Amazon’s fulfillment network like a living, breathing system—one that can be optimized with planning, data, and flexibility.

Whether you’re just starting out or scaling a seven-figure brand, it’s time to move beyond passive fulfillment and start managing your location strategy as a core part of your business success.

Author Bio

Arishekar N. is the director of marketing and business development at AMZ Prep. Bringing decades of experience in driving growth for e-commerce businesses, he has established himself as a thought leader in the digital marketing space.

His expertise spans strategic marketing, e-commerce operations, SEO, advertising, and branding. Arishekar has successfully led numerous campaigns that have yielded specific achievements, such as a 200% increase in online sales for client businesses.

As a regular contributor to respected industry publications, Arishekar shares valuable insights on optimizing online business performance and navigating the ever-changing e-commerce landscape. His data-driven approach and commitment to ethical marketing practices have earned him recognition as a trusted voice in the industry.

Arishekar dedicates his efforts to equipping entrepreneurs and marketers with practical strategies that can significantly enhance their financial performance. For the latest trends, tips, and expert analysis in e-commerce and digital marketing, follow Arishekar N on https://in.linkedin.com/in/arishekar