As part of the 2024 fee changes Amazon has introduced a new type of fee - FBA inbound placement service fee, for standard and large bulky-sized products effective from 1 March 2024. Amazon cites the cost of distributing inventory to fulfillment centers close to customers to justify this fee.

Sellers will be charged an average of $0.27 per unit for standard-sized products and $1.58 per unit for large bulky-sized products. Amazon claims that they will allow sellers to pay reduced fees or no fees depending on whether they ship to a single location or multiple locations. The fee will be charged 45 days after the products are received by Amazon. This means sellers will get the first invoices for inbound placement service starting April 15, 2024.

Amazon Warehousing and Distribution (AWD) customers will not be charged new inbound placement service fees since AWD pricing covers this service.

Simultaneously with the implementation of the new inbound fee, Amazon also announced that there will be a decrease in FBA fulfillment fees, effective April 15, 2024. On average, FBA fulfillment fee rates will be decreased for standard-sized products by $0.20 per unit and for large bulky-sized products by $0.61 per unit.

The added new inbound placement fees per unit are on average higher than the announced decrease in FBA fulfilment fees. This creates a new challenge for sellers in understanding the new fees, optimizing their total FBA fulfillment costs, and trying to keep their business profitable. For now, the new fee for FBA inbound placement service seems to be the case for Amazon US sellers but we may soon expect to see similar fees in also Amazon EU and other marketplaces.

What is Inbound Placement Service fee for?

After you ship your products to Amazon for FBA, Amazon distributes them to the fulfilment centers (FCs) within its network, since keeping the products in multiple locations across the country helps fulfilling the customer orders faster with lower costs driving more sales.

With a motive of efficient management of its network for placing inventory and delivering products to customers Amazon decided to charge sellers for distributing their FBA products within its fulfillment centers which wasn’t the case before. In other words, Amazon will charge separate fees for inbound (receiving and placing of FBA inventory into Amazon FCs) and outbound (delivering customer orders from Amazon FCs).

Amazon created this new fee called FBA Inbound Placement Service Fee to apply for inbounding activities to cover the costs of distributing inventory of FBA sellers upon receipt to its fulfillment centers across the country. Amazon will also make a small decrease in FBA outbound fulfillment fees (on average $0.20 per unit for standard-size products and $0.61 per unit for Large Bulky-size products) valid from April 15, 2024, which is the same date that the first inbound placement service fees will begin to be charged.

By introducing this new fee Amazon terminated the “FBA Inventory Placement program” on February 29, 2024, which was ensuring all units of a specific ASIN being routed to the same fulfillment center for a fee. “FBA Multiple Destinations” and “Amazon recommended shipment options” programs also ended on February 29, 2024, which was providing FBA fulfillment fee rebate incentives to sellers while creating shipping plans.

FBA inbound placement service options

Sellers will be provided to select from the below inventory inbound placement options while creating shipping plans:

• Minimal shipment splits: Send your FBA products to the minimal number of fulfillment centers, generally to a single location. Amazon then distributes your products across its network for a per item fee.
• Partial or Amazon-optimized splits: Send your FBA products to multiple fulfillment centers. No fee if you send your products to 4 or more locations (regarded as optimal by Amazon) or a reduced fee if you send to 2 or 3 locations (called as partial number of locations).

These options will be offered only for the qualifying shipments depending on the product types and quantities in the shipping plan, current FBA inventory levels, and the location of customer demand. Amazon suggests creating separate shipment plans for standard-size items, non-standard-size items, and each special handling category, equal item mix and quantities across all boxes, higher number of boxes in order for the seller to be able to see higher number of inbound placement options.

Sellers will be available to select their preference for inbound placement service option and preferred region through
Seller central > Settings > Fulfillment by Amazon > Inbound settings.

The settings above will be applied for the shipping plans created via Amazon APIs. Sellers using Send to Amazon workflow in Seller Central to create a shipping plan can choose their inbound placement option during Step 2 of the shipment-creation workflow.

Per Unit Rates for FBA Inbound Placement Service fee

FBA inbound placement service fees for standard size and large bulky size products to be charged per-unit valid from March 1, 2024 are shown in the table below. Extra-large-size products are out of scope of the FBA inbound placement service fee. As you can see item size, item weight, number of fulfillment centers and physical location of the FCs are among the parameters that determine the fee rates.

Table 1 - Standard-size product fees

Size	Weight	FBA inbound placement services
		Minimal shipment splits	Partial shipment splits	Amazon-optimized shipment splits
		Send to single location	Send to two or three locations	Send to four+ locations
Small standard Max 15 x 12 x 0.75 inches	16 oz or less	$0.21 to $0.30	$0.12 to $0.21	No fee
Large standard Max 18 x 14 x 8 inches	12 oz or less	$0.23 to $0.34	$0.13 to $0.24
	12+ oz to 1.5 lb	$0.27 to $0.41	$0.15 to $0.28
	1.5+ lb to 3 lb	$0.32 to $0.49	$0.17 to $0.34
	3+ lb to 20 lb	$0.42 to $0.68	$0.23 to $0.48

Table 2 - Large bulky-size product fees

Size	Weight	FBA inbound placement services
		Minimal shipment splits	Partial shipment splits	Amazon-optimized shipment splits
		Send to single location	Send to two or three locations	Send to four+ locations
Large bulky size Max 59 x 33 x 33 inches	5 lb or less	$2.16 to $2.67	$0.55 to $1.48	No fee
	5+ lb to 12 lb	$2.55 to $3.15	$0.65 to $1.75
	12+ lb to 28 lb	$3.19 to $3.95	$0.81 to $2.19
	28+ lb to 42 lb	$4.13 to $5.11	$1.05 to $2.83
	42+ lb to 50 lb	$4.85 to $6.00	$1.23 to $3.32

Example calculation for inbound placement fee

Here are some example calculations of inbound placement service fees for different options.

Example 1:
Minimal shipment split option with one inbound location in the West region.

Product-A	Size tier: Large standard Shipping weight: 12 oz or less Quantity: 100 units
FBA inbound placement service selected	Location or locations: One location or shipment, West region Minimal shipment splits rate per unit: $0.34 (West region)
FBA inbound placement service fee (charged 45 days after initial receive)	Total fee: 100 units x $0.34 = $34.00

Example 2:
Partial shipment splits option with two locations or shipments sent to West region.

Product-B	Size tier: Large standard Shipping weight: 12 oz or less Quantity: 100 units
FBA inbound placement service selected	Location or locations: Two locations or shipments Partial shipment splits rate per unit: $0.24 (West region)
FBA inbound placement service fee (charged 45 days after initial receive)	Shipment 1- West region fee: 40 units x $0.24 = $9.60 Shipment 2- West region fee: 60 units x 0.24 = $14.40 Total fee: $24.00

How to estimate the amount you will pay for inbound placement service?

An estimate of new inbound placement fee for each available placement option will be shown to sellers on shipment summary page while creating a shipping plan through either Send to Amazon or Amazon Marketplace Web Service API workflows.

You can also visit the Amazon Revenue Calculator web site, updated in February 2024, to get an estimate of FBA inbound placement service fee payable per unit for each of your SKUs.

How to see the actual inbound placement fee you were charged for each of your shipment?

Sellers will be charged the fee 45 days after their shipment is received by Amazon depending on the inbound location and the quantities received.

Amazon has created a new downloadable report namely ‘FBA Inbound Placement Service Fee Report’ to help sellers track their actual FBA inbound placement service fee they paid at the shipping plan, shipment, and SKU level. The report will also show whether your shipping plan is compliant or contains any inbound defect. You can locate the report by selecting ‘Fulfillment’ in the ‘Reports’ drop-down menu and then scrolling down on the left of the page. You will see the ‘FBA Inbound Placement Service Fee Report’ under the Payments section.

How to reduce or avoid from the inbound placement fees?

The amount of inbound placement fee you will pay mainly depends on how you inbound products to Amazon.

You can pay reduced fee or no fee by using partial shipment split or Amazon optimized shipment splits option (sending your products to multiple fulfillment centers) if your shipping plan qualifies. And also, according to Amazon, you may generally expect lower inbound placement service fees for shipments sent to fulfillment centers outside of the western part of the country.

Reducing the product packaging size and weights will also contribute both to lower inbound placement fees, as well as lower FBA fulfillment rates.

Conclusion

As a result, the new FBA inbound placement service fee means another challenge for Amazon sellers to be taken into consideration in protecting their profit margin which is eaten by many different cost items. Sellers need to understand how much this new fee will reduce their margin for each product they sell on Amazon FBA and decide whether it’s reasonable to keep selling those products through FBA.

On the other hand, you should evaluate the inbound placement service fee options you see on Amazon and pick the most reasonable one for your specific circumstances while creating FBA inbound shipments. But you need to be cautious while creating shipping plans since Amazon warns sellers that deleting or abandoning shipments to prevent splits in a shipping plan will result in a higher inbound placement service fee or you may be charged inbound defect fees due to non-compliance.

Profit Cyclops, as an accurate profit calculator for Amazon sellers, can help sellers easily see all Amazon fees they pay and quickly calculate their net profit for each product they sell on Amazon so that they can focus on expanding their business with a clear vision to maintain profitability.