Amazon gives you a choice on every inbound shipment: **send everything to one location and pay an inventory placement fee, or split it across several fulfilment centres and pay no fee.**

**Most sellers pick one and never revisit it.** But which is cheaper is a per-product calculation, and it flips depending on how your product packs.

[Watch the walkthrough](https://kb.trackiq.com/kb-assets/kbvideo-placement-explainer-c36bdfb3.mp4)

*Prefer to watch? One hundred and sixty-three seconds on why packing efficiency decides the answer, costing both options as dummy shipments, and the costs that never appear in a freight quote.*

## **The trade**

**Pay the placement fee** — one destination, one freight movement, a fee per unit.

**Split the shipment** — no fee, but you are now paying freight to several destinations instead of one.

**The split option is only cheaper when the extra freight costs less than the fee.** That depends almost entirely on how efficiently your product fills a box.

## **Why packing efficiency decides it**

**A product that fits 48 units to a box where the box could hold 182 is shipping mostly air.**

**And you cannot always fix that** — case pack configurations are frequently fixed by your supplier and not negotiable.

**When a product packs badly, every additional destination multiplies an already inefficient shipment**, and splitting across five locations gets expensive quickly.

**When a product packs densely, the extra destinations cost comparatively little**, and avoiding the fee wins.

**So the answer is genuinely per product**, and worth recalculating when case packs or rates change.

## **How to work it out**

**Build the same shipment twice as a dummy, and compare.**

**1. Create a dummy inbound to FBA with the split** — Amazon assigns the destinations and quotes the freight. That gives you the multi-destination cost.

**2. Create the equivalent single-destination shipment** and read the placement fee.

**3. Compare, and divide by units** to get the saving per unit.

### **A worked example**

**A product with a warehouse in California, 48 units per box.**

**Shipping to AWD in California: quotes ranged $430–620, so take a midpoint of about $500.**

**The same shipment inbound to FBA across five locations: $1,543.**

**Splitting to five FBA locations was substantially more expensive than a single AWD movement** — so for this product, the consolidated route won clearly.

**That gap is a packing problem showing up as a freight problem.**

![Units and cost, per product](/kb-assets/shot-prod-table-6c206b.png)

**This calculation is per product, per shipment, and it changes as rates and case packs change** — see [**Where Your Margin Actually Goes**](https://kb.trackiq.com/hc/knowledge-base/articles/where-your-margin-actually-goes). A decision made once against last year's rates is not a decision that still holds.

## **The third option**

**AWD often beats both.**

**One inbound movement to a single AWD facility, then Amazon distributes to FBA** — so you avoid the placement fee and the multi-destination freight, and you gain a replenishment buffer.

**Run the comparison three ways, not two:**

**Split FBA shipment, no fee.**

**Consolidated FBA shipment, plus fee.**

**Inbound to AWD**, plus AWD storage, processing and transportation fees.

See [**Is AWD Cheaper?**](https://kb.trackiq.com/hc/knowledge-base/articles/is-awd-cheaper) and [**AWD Shipping and Replenishment**](https://kb.trackiq.com/hc/knowledge-base/articles/awd-shipping-and-replenishment).

## **What else the split costs you**

**Freight is not the only difference.**

**Check-in time.** More destinations means more shipments to track, and any one of them can stall — see [**Creating a Shipping Plan**](https://kb.trackiq.com/hc/knowledge-base/articles/creating-a-shipping-plan).

**Reconciliation effort.** Each destination is a separate shipment to check for discrepancies — see [**Claiming for Shipment Discrepancies**](https://kb.trackiq.com/hc/knowledge-base/articles/claiming-for-shipment-discrepancies).

**Stock fragmentation.** Units spread thinly across regions can leave you technically in stock but slow to serve.

**None of these appear in the freight quote**, and on a marginal calculation they should tip you toward consolidation.

## **Common mistakes**

**Choosing once** and applying it to every product regardless of how they pack.

**Comparing the fee against freight to one destination** rather than to all the destinations Amazon assigns.

**Ignoring case pack efficiency**, which is the variable that actually decides it.

**Leaving AWD out of the comparison**, where it frequently wins.

**Counting only freight**, and ignoring the tracking and reconciliation load of five shipments.

**Not recalculating** when rates move or a supplier changes the case pack.

## **Related**

- [**Is AWD Cheaper?**](https://kb.trackiq.com/hc/knowledge-base/articles/is-awd-cheaper) — the third route, and how to cost it.
- [**Creating a Shipping Plan**](https://kb.trackiq.com/hc/knowledge-base/articles/creating-a-shipping-plan) — where the split is assigned.
- [**Where Your Margin Actually Goes**](https://kb.trackiq.com/hc/knowledge-base/articles/where-your-margin-actually-goes) — what a per-unit freight saving is worth.