Peak season is here, and the new year will bring higher costs for anyone storing inventory in Amazon’s West Coast AWD network. Beginning January 15, 2026, Amazon Warehousing & Distribution (AWD) will raise West Coast storage fees from $0.48 to $0.57 per cubic foot per month.
Amazon claims this change will help “reduce congestion,” but for sellers it means higher landed costs and slower inbound processing.
Amazon has also introduced a temporary inbound promotion through January 14, 2026, for palletized, single-SKU shipments priced at $1.00 per box. After that window, rates rise to $1.35–$2.50 per box depending on conformity. Small-parcel shipments (SPD) are no longer accepted at these centers, and capacity at major hubs like IXD (Buckeye, AZ) is already limited.
RELATED: Amazon Announces AWD, MCF & Buy with Prime Fee Increases for 2026
How Margin Pressure Is Reshaping Amazon Logistics
In today’s market, seven-figure Amazon sellers are operating on thinner margins than ever. A few years ago, 20–25% profit was common. Now, many sellers hover near 10–12%. Amazon’s placement fees, surcharges, and storage transfers quietly consume thousands of dollars per SKU before a single sale occurs.
What used to be a back-office detail is now a major profit driver. Sellers who take control of inbound routing, warehouse timing, and storage duration are the ones maintaining healthy growth while competitors absorb the extra cost.
When AWD Stops Saving Money
AWD can be useful for quick turns, but it loses its advantage once products sit longer than a month. Remember: AWD was originally designed as a transit point, not long-term storage. Once goods sit two to three months, 3PL warehousing becomes cheaper – and after January’s rate hike, that gap will only widen.
Amazon’s algorithm rewards speed and availability, and many sellers underestimate how long AWD transfers actually take. It’s common for shipments to check in but remain inactive for weeks while Amazon redistributes inventory. By then, the storage and opportunity cost outweigh AWD’s convenience.
When your inventory is positioned near customers, your products are delivered faster and ranked higher. If a competitor’s stock is already in nearby fulfillment centers and yours is still moving through AWD, Amazon’s algorithm favors your competitor’s listing.
That difference in coverage can raise conversion rates by 4–10%.
In a marketplace where every margin point matters, speed to shelf directly influences profitability.
RELATED: 3PL vs. Amazon FBA vs. Warehouse: Choosing the Best Ecommerce Fulfillment Model
Why East Coast Routing Is Gaining Ground
Amazon’s East Coast facilities have become the most reliable for check-in times and consistency. Centers in New Jersey, Tennessee, and North Carolina average 1–1.5 day check-ins, while West Coast hubs regularly face multi-week delays.
When January’s AWD surcharge takes effect, the West Coast will remain the most expensive region at $0.57 per cubic foot, compared to about $0.48 in the East.
Here’s the official message from Amazon AWD:
How are inbound processing fees different in the West Coast Palletizable (US) region?
For shipments received at our new West Coast Palletizable region between September 1, 2025, and December 31, 2026, we’re offering a limited-time promotion of 25% discount on the inbound processing fee. Shipments received until January 14, 2026, will be charged inbound processing fee of $1 per box and shipments received starting January 15, 2026, until December 31, 2026, will be charged $1.05 per box. To qualify for this promotion: Send shipments of single-SKU pallets up to 60 inches in height or floor-loaded shipments that we can build into pallets. Your floor-loaded shipments must contain no more than 10 SKUs and at least 200 boxes per shipment. Shipments that don’t meet the criteria or don’t match the content stated on the shipment order will be charged a $2.50 per box inbound processing fee. For more details, go to AWD West Coast Palletizable (US) Region Launch Promotion.
The benefits of West Coast vs. East Coast storage are dependent on your needs. While it is cheaper to store on the East Coast, in many cases keeping shipping to the West Coast will be faster and ultimately more efficient.
📅 Book a call with our team to talk about which option makes the most sense for you.
Forecasting and Flexibility Are the New Competitive Edge
Most sellers plan too late. Effective operators forecast at least six months ahead, aligning production, customs, and warehouse capacity with inbound targets. Building this discipline removes last-minute booking stress and keeps costs predictable.
Your Supply Chain Checklist for Q4 and Q1 2026
- Route fast-moving SKUs through SplitSmart™ for faster shelf time.
- Stage backup inventory in East Coast warehouses instead of AWD West.
- Review placement-fee spending and compare to flat-rate delivery options.
- Adjust Q1 forecasts using the new $0.57/cu-ft AWD West rate.
- Rebalance inbound flow toward the East Coast for faster check-ins.
The Future Belongs to Sellers Who Control Their Supply Chain
Automation is Amazon’s strength, but adaptability is yours. The sellers who win in 2026 will pivot seamlessly between AWD, 3PL, and D2C fulfillment without losing visibility or speed.
At Tactical, we were sellers first. We understand how to protect margins, maintain rank, and scale operations efficiently. From factory pickup to final-mile delivery, we give you the control Amazon’s system cannot.
SplitSmart™: The Flat-Rate FBA Delivery Model
To solve for AWD and supply chain inefficiencies, Tactical created SplitSmart™, a flat-rate delivery service that replicates Amazon’s multi-location coverage without placement fees or hidden costs.
With SplitSmart™, Tactical picks up from your warehouse or container, sorts and consolidates pallets, and then delivers to five Amazon fulfillment centers at once.
That includes:
- One pickup, five destinations
- 8–10 day time-to-shelf
- Full visibility and live-unload appointments
- No placement or transfer fees
SplitSmart™ gives sellers predictable cost control and faster coverage, eliminating the delays that often come with AWD transfers. Book a call to learn more.
Plan Your Next Step
📦 Learn more about SplitSmart™ flat-rate FBA delivery
🏬 Explore 3PL warehousing and distribution
🚚 See Freight Forwarding & Customs Clearance
📅 Book a call to build your peak-season routing plan.