Why a China Warehouse Won’t Fix Your Stockouts (And What Actually Will)

On the 6 May 2026 Campfire, Michael asked about Amazon’s new service: a warehouse in China (launched April 2026) intended for US distribution. He wanted to know if there was any merit in using it.

Angela’s answer was direct: “Very limited benefit.”

Here’s why – and what you should do instead.

The problem with a China warehouse

At first glance, storing inventory in China sounds like a smart way to keep stock close to your supplier. But think about the timeline: even if your product is in a Chinese warehouse, it still needs to be shipped across the Pacific. That’s 20–30 days on a boat, plus customs, plus trucking to an FBA centre.

By the time it reaches US customers, you’re looking at a month or more. That doesn’t help you restock quickly when you run low. And in the meantime, your cash is tied up in inventory that isn’t earning you any money.

As Angela put it: “Opportunity cost is what I’m trying to get at. You don’t want stagnant inventory. You don’t want to hold your cash flow up with stock sitting in a China warehouse because you’ve over‑ordered.”

Better alternatives that actually work

1. Negotiate batch releases with your supplier

Instead of ordering 3,000 units and taking delivery of all of them at once, make a deal: order 3,000, pay a deposit, but only release 500 or 1,000 at a time. Your supplier holds the rest. You pay the balance as each batch ships.

This keeps your cash flow healthy because you’re not paying for all 3,000 units upfront. And you’re not paying storage fees on stock you don’t yet need.

Angela uses this strategy herself: “I order 3,000 at a time. They make 3,000, I pay the deposit, then I release them as I want them – 500 at a time or a thousand.”

2. Use AWD (Amazon Warehouse Distribution)

AWD is Amazon’s own warehousing service, designed for bulk storage. It’s cheaper than FBA storage fees, and you can enable auto‑replenishment: when your FBA stock runs low, Amazon automatically moves units from AWD into FBA.

The key difference: AWD is already in the US. Replenishment takes days, not weeks.

“To me that’s a much better option,” Angela said. “At least you’ve got it out of China into the country that you’re trying to sell, and it’s only a couple of days away.”

3. Set up a rolling monthly order

Once you’ve been selling for a while and you know your monthly sales velocity, you can stop guessing. Place a fixed monthly order with your supplier – say, 1,000 units every month. As one batch ships, the next batch goes into production.

This creates a continuous flow. You never have to place huge, risky orders, and you never run out of stock for long.

Why the China warehouse is aimed at Chinese sellers

Angela suspects the new service is really designed for Chinese sellers who are already manufacturing in China and want to consolidate logistics before shipping to the US. For Australian or Western sellers, it doesn’t solve any real problem.

“There’s also the unknown costs issue,” she added. “If you’ve already shipped into the US, you know what your costs are. If it’s still in China, you’re exposed to whatever new tariffs or freight fees pop up.”

The bottom line

Don’t be seduced by the idea of a China warehouse. It sounds convenient, but it ties up your cash and doesn’t necessarily speed up your supply chain.

Instead:

• Negotiate batch releases with your supplier.

• Use AWD for US‑based bulk storage.

• Move to rolling monthly orders once you know your numbers.

Your goal is to keep inventory moving and cash flow healthy – not to park stock on the other side of the ocean.