You've probably heard of Amazon fulfillment centers if you're in the eCommerce business. But what are they exactly, and how do they work?
Amazon fulfillment centers are large warehouses where Amazon stores inventory for their ecommerce business. When an order is placed on Amazon, products are picked from the fulfillment center shelves and shipped to the customer. These facilities enable Amazon to store products until they are purchased and provide quick delivery times.
Amazon operates over 175 fulfillment centers globally that are designed for efficiency. Here are some of their key features:
Storing inventory in Amazon fulfillment centers and using their logistics network provides several advantages:
While using Fulfillment by Amazon (FBA) can reduce overall costs, there are fees to consider:
Understanding all the costs allows you to accurately determine the profitability of selling on Amazon.
When evaluating fulfillment solutions, consider these key factors:
Choosing the right fulfillment partner allows you to cost-effectively scale your ecommerce business.
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Amazon fulfillment centers are giant warehouses that store millions of products. They serve as the foundation of Amazon's logistics network, optimized for efficiency and speed.
After a customer order is received, workers pick the purchased items from fulfillment center shelves. The order is packed, sealed, and shipped via Amazon's large network of shipping partners.
As of 2022, Amazon has over 450 active fulfillment and sortation centers globally. These facilities have a total storage footprint exceeding 150 million square feet.
By handling inventory storage, order processing and shipping themselves, Amazon can deliver products faster and more cost-effectively. This enables competitive pricing and convenience.
FBA allows third-party sellers to store products in Amazon fulfillment centers. Key benefits include fast Prime shipping, reduced logistics costs and access to Amazon's customer base.
Amazon charges FBA fees including monthly inventory storage fees, order fulfillment fees and outbound shipping fees. There may also be other variable fees depending on the product.
Strategic fulfillment center locations, advanced inventory and order management technology, and integrated transportation enable Amazon to often ship products within 1-2 days domestically.