Amazon FBA inventory in Business Central

Amazon FBA inventory in Business Central: From your own warehouse to Amazon’s fulfilment network

When goods are sent to Amazon FBA, they do not disappear from the company’s supply chain.

They simply change location and responsibility.

That makes FBA inventory in Business Central an interesting area, because the ERP system still has to be able to give the company a usable picture of stock, tied-up capital and the need for replenishment.

Amazon FBA means that Amazon handles, among other things, storage, picking, packing, shipping, customer service and returns handling for the relevant FBA orders. Sell on Amazon

But Business Central still has to support the company’s own overview.

FBA as a separate stock location

An obvious model can be to represent the FBA stock as a separate location or inventory logic in Business Central.

For example:

OWN WAREHOUSE
AMAZON FBA DE
AMAZON FBA SE

That is not necessarily the right model for all companies, but the principle is important:

You have to be able to tell the difference between an item sitting in your own warehouse and an item located in Amazon’s fulfilment network.

Goods on their way to Amazon

One of the interesting phases is the time between:

“the item leaves our warehouse”

and

“Amazon has received and registered the item”.

If the company simply deducts the item from its own stock and immediately adds it to FBA stock, the system can show a picture that does not correspond to reality.

That is why it can be relevant to work with a transit or inbound status.

That makes it possible to distinguish between:

• goods in your own warehouse
• goods shipped
• goods in transit
• goods received by Amazon
• goods available for sale

Replenishment should not be based on gut feeling

When the FBA stock gets low, the company has to decide how much to send in.

Too little stock can lead to lost sales.

Too much stock ties up capital and can result in further inventory-related costs. Amazon works with, among other things, monthly storage costs and potential costs for aged inventory. Sell on Amazon

A better basis for decisions can take into account:

• sales history
• current FBA stock
• goods in transit
• lead time
• season
• forecast
• inventory cost

What do you do when the figures do not add up?

Differences can arise between the company’s expected FBA stock and Amazon’s registered data.

So what is interesting is not only synchronisation.

It is also reconciliation of inventory data.

If Business Central expects 300 items at Amazon, but Amazon shows 294, the company has to be able to identify the deviation and decide how it should be handled.

One FBA stock or several?

If the company operates in several markets, the inventory structure should be thought through.

Does the company need a detailed country-based ERP overview?

Or is a more consolidated model sufficient?

The answer depends on your fulfilment setup, reporting needs and accounting model.

That is why the inventory structure should not be designed on the basis of “this is how others do it”, but on the basis of the questions you actually need to be able to answer in Business Central.

FBA inventory and finance go hand in hand

Inventory is not just quantities.

It is capital.

If goods sit too long at Amazon, it affects both cash flow and potential inventory costs.

That is why FBA inventory data is relevant for both supply chain and finance.

See also [What does Amazon FBA really cost?](/amazon-fba-omkostninger-business-central/).

The new perspective

The biggest mistake is to regard Amazon FBA as a black hole:

“We send the goods to Amazon, and then they take care of the rest.”

Amazon takes care of fulfilment.

But the company still needs control.

Business Central should therefore be able to help answer:

Where are our goods?

How much can be sold?

What is on the way?

When do we need to replenish?

How much capital do we have tied up at Amazon?

That is where the integration becomes interesting.

Get your FBA inventory flow between Amazon and Business Central reviewed

Read also: Amazon FBA integration for Business Central