Amazon has announced its 2025 fee updates for Amazon Warehousing and Distribution (AWD), Multi-Channel Fulfillment (MCF), and Supply Chain by Amazon Managed Service. While some changes look like “discounts,” they come with strings attached, and others quietly hit sellers’ strategies and wallets. If you’re using Amazon logistics to save time and money, there’s more to this than meets the eye.
1. The AWD Smart Storage Discount – Not So Smart for Sellers
Previously, getting the discounted AWD rates was simple: just use an Amazon-partnered carrier. Now? You’ll need to maintain “sufficient levels of inventory” to earn the 10% discount on storage fees.
What does this mean? Sellers with fluctuating inventory may lose out. At first glance, $0.43 per cubic foot looks great, but for sellers struggling with demand variability, it’s another hoop to jump through.
Translation: More rules, more stress—especially for smaller sellers trying to optimize cash flow.
2. AWD + MCD Strategy Takes a Hit
In the past, we recommended using AWD warehouses as a cost-effective hub for Multi-Channel Distribution (MCD). That strategy just got a lot more complicated.
Starting in April 2025, MCD outbound fees will be distance-based. If your AWD warehouse is too far from your 3rd-party destinations, costs will skyrocket. While short-haul shipments might get cheaper, sellers relying on AWD as a distribution center now have to carefully map out locations to avoid higher fees.
What this means: AWD is no longer the “plug-and-play” MCD solution it once was—you’ll need to crunch the numbers to see if it’s still worth it.
3. Supply Chain Managed Services: What Is It, and Who Should Care?
Amazon’s Supply Chain Managed Service is their attempt to offer an end-to-end solution for logistics. Think of it as Amazon taking control of your entire supply chain—from factory to warehouse to customer.
For sellers overwhelmed by logistics, this managed service simplifies operations:
- Amazon handles warehousing, transportation, and fulfillment.
- Sellers get discounts: 20% off AWD storage fees and 10% off AWD transportation fees (to FBA).
While this can save time and streamline your operations, it’s not free. Sellers need to compare the “convenience cost” against the flexibility of handling logistics themselves.
4. Fee Hikes – So Much for “No Increases”
Remember when Amazon promised no fee increases earlier this year? Well, they kept that promise over there but quietly slipped in hikes over here.
- MCF fees will rise 3.5% on average, with heavier units seeing varied increases.
- At least lighter products (under 1 lb) are spared—for now.
While Amazon boasts that MCF hikes are lower than other carriers’ 5.9%, it still feels like a punch to the gut for sellers already pinching pennies.
Here’s the reality: If you’re using Amazon logistics across multiple channels, your costs are going up, no matter how Amazon spins it.
What Should You Do Next?
Amazon’s changes are designed to look seller-friendly, but the fine print reveals more hurdles and fee hikes. Strategies like using AWD for MCD now demand careful planning, and the Supply Chain Managed Service—while convenient—requires a close look at long-term costs.
Need help navigating the logistics maze? At Amazon Storage Pros, we cut through the noise to make logistics simple, affordable, and effective. From AWD optimization to MCF cost management, we’ll help you stay profitable in 2025.
Don’t let these changes derail your business—let’s keep your operations running efficiently and your profits on track!