What is the Amazon AWD program?

The Amazon AWD program is a comprehensive storage and distribution solution. Amazon stores your products and ensures they are sent to Amazon FBA fulfillment centers or directly to your end customers.

In this article by Jordi Ordóñez, we dive deep into the Amazon AWD program: what it is, how it works, and how to take full advantage of it to maximize your Amazon store’s profitability.

What does AWD mean in Amazon

The acronym AWD stands for “Warehousing & Distribution” showcasing Amazon’s ability to act as a fully integrated storage and distribution system. This service not only stores your products but also ensures their transfer to Amazon FBA fulfillment centers or directly to your customers if you operate using hybrid or direct models.

The true value of AWD lies in its seamless integration into Amazon’s ecosystem. There’s no need for a third party to handle the movement of products, as Amazon manages everything for you. This results in less coordination, fewer errors, and, ultimately, greater efficiency.

If you're interested in optimizing your Amazon business even further, you might want to check out our eBook: Guide to Selling on Amazon. 

What is an AWD product

An “AWD product” refers to any item you decide to store in Amazon AWD facilities. These products are managed by Amazon from the moment they arrive at the warehouse until they are shipped to an FBA distribution center, a final customer, or another designated destination.

This program is ideal for products with steady demand or those requiring large-scale storage. Moreover, it offers a cost-effective solution for sellers aiming to avoid the high long-term storage fees of FBA, as AWD warehouses often feature more competitive pricing for such services.

When did Amazon launch the AWD program

Amazon introduced the AWD program in 2022, initially as a pilot test for a limited group of sellers. The program’s success and positive reception led to its expansion, making it available to all professional Amazon sellers in the United States. This launch aligns with Amazon’s broader efforts to position itself as a global leader in logistics and distribution.

What is an Amazon last-mile facility

“Last-mile” facilities are logistics centers specialized in the final stage of delivery, from the warehouse to the customer’s doorstep. In the context of Amazon AWD, these facilities play a critical role in ensuring fast delivery, especially for products managed under Prime delivery models.

Amazon uses these centers to reduce transit times and enhance the final customer’s experience. For sellers, this means faster product delivery and lower logistics costs.

Amazon AWD vs. FBA: Key differences

Amazon offers a variety of tools to help sellers manage their inventory and logistics, but two of its most important services are Amazon AWD (Warehousing & Distribution) and Amazon FBA (Fulfillment by Amazon). While both aim to streamline operations and improve delivery efficiency, they serve different purposes within Amazon's ecosystem.

How is Amazon AWD different from FBA?

While Amazon AWD and FBA might seem similar, they serve different purposes:

• AWD focuses on large-scale storage and distribution, making it ideal for managing inventory and restocking FBA centers or direct shipping.
• FBA, on the other hand, is a fulfillment model that handles short-term storage and customer delivery.

Combining both services can be a strategic move for sellers needing to store products longer before transferring them to FBA.

When should you use Amazon AWD instead of FBA?

Use AWD if you have large inventories, seasonal products, or need a more cost-effective storage solution, and use FBA to handle high-turnover products requiring fast delivery.

Amazon AWD fees

Amazon AWD fees are designed to be competitive. They include:

1. Storage Costs: Calculated based on the space occupied (per cubic foot) and the storage duration.
2. Handling and Distribution Fees: Cover the cost of moving inventory between warehouses or to FBA centers.

Although prices may initially seem high, their logistical integration and efficiency often offset the additional costs. At Jordi Ordóñez, we help you calculate these fees and optimize your investment.

Is Amazon AWD worth it?

Yes, in many cases. Amazon AWD is particularly valuable if:

• You handle large inventories.
• You need a simplified logistics system.
• You want to reduce costs associated with logistical errors or unnecessary transportation.

However, it’s not always the best choice for every seller. At Jordi Ordóñez, we analyze your business and help you decide whether Amazon AWD is the right fit for your needs.

Amazon AWD logistics

Amazon AWD logistics are designed to offer sellers an integrated solution that seamlessly connects storage, distribution, and inventory replenishment. This service centralizes products in strategically located warehouses and manages their shipment to FBA centers, last-mile facilities, or even directly to end customers.

Below, we explain the key components of the AWD logistics system, including pallets, warehouses, auto-replenishment, and more.

Amazon AWD pallet: What is it and how does it work?

An “AWD pallet” is a storage unit within Amazon’s system. These pallets are ideal for products in large quantities and enable more efficient and cost-effective logistics.

Amazon AWD auto-replenishment

The auto-replenishment system in AWD ensures you never run out of stock at FBA centers, automatically shipping products when low levels are detected.

Amazon AWD warehouse: What are the facilities like?

AWD warehouses are high-capacity facilities designed to handle large inventory volumes. Some are refrigerated, allowing for the storage of perishable or temperature-sensitive products.

Amazon AWD reviews and use cases

The Amazon AWD program has garnered significant interest from sellers looking to optimize their logistics. Generally, reviews highlight its ability to simplify inventory management, reduce costs, and improve operational efficiency. However, as with any tool, the results depend on the type of business and how the program is integrated into the seller’s logistics strategy.

Amazon AWD on Reddit: What do users say?

On platforms like Reddit, many sellers praise the ease of use and integration of the program with Amazon FBA. However, they also emphasize the importance of carefully calculating fees to avoid unexpected costs.

Amazon AWD seller experiences

Testimonials from sellers indicate that AWD is particularly useful for reducing long-term storage costs and simplifying logistics.

If you work in educational, creative, or niche sectors—like those who sell products such as the Lectómetro Escolar or manage platforms like Quenarras—Amazon AWD can help you better manage your inventory, improve the customer experience, and optimize logistics costs.

If you want to take your Amazon business to the next level, contact Jordi Ordóñez. We not only help you understand the program but also implement strategies to maximize its potential.

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