Overview

Amazon sellers must manage two linked logistics streams: inbound, which brings products from manufacturers to storage, and outbound, which moves orders from storage to customers. Overlooking either side can erode margins, trigger stockouts, or damage seller metrics. Understanding both flows is crucial for maintaining healthy inventory and winning the Buy Box.

Key Points

• Inbound lead time — A shipment from a Chinese factory typically requires 30‑45 days of ocean freight plus 5‑7 days for customs clearance.
• Outbound speed requirement — Prime‑eligible listings must ship within two days of order placement, or the seller risks losing the Buy Box.
• FBA labeling rule – Amazon rejects any pallet that lacks the required scannable barcode, leading to a $25 per‑case re‑processing fee.
• Inventory Performance Index (IPI) threshold — Sellers with an IPI below 400 are limited to 50 % of their historical storage capacity.
• Carrier cost variance — Same‑day courier rates can exceed $15 per package, while ground freight for a 5‑lb parcel averages $4.20.
• Safety‑stock ratio — Maintaining a safety stock equal to 15 % of average weekly demand can absorb a one‑week supplier delay without a stockout.

How Inbound and Outbound Logistics Work

1. Supplier selection & order placement — A seller contracts a Vietnam‑based manufacturer for 5,000 units of a kitchen gadget, specifying a FOB price of $4.20 per unit.
2. Transportation to Amazon fulfillment — The goods travel on a 40‑foot container, arrive at the West Coast port after 33 days, and are cleared through customs with a $1,200 duty payment.
3. Receiving & inspection at the fulfillment center — Amazon’s inbound team scans each pallet; a discrepancy of 12 missing units triggers a “receiving exception” alert that must be resolved within 48 hours.
4. Inventory placement — Approved pallets are stored in a designated bin; the system assigns a bin code like “A‑12‑B‑07” for quick retrieval.