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Exploring a Fully Automated NetSuite Integration to Fulfillment By Amazon Seller Central

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This article is relevant for NetSuite users seeking to automate their inventory management for the Fulfillment by Amazon (FBA) Seller Central Program.

Background

Many of our clients leverage Shopify (see my previous article) to market their products directly to consumers. Yet, they also aim to broaden their market presence and enhance distribution via the Amazon Marketplace, the leading platform for indirect e-commerce sales.

Expanding sales on Amazon can be achieved through various strategies, including the Fulfillment by Amazon (FBA) model. In FBA, the objective is to transfer goods to Amazon’s warehouses, allowing Amazon to handle fulfillment. This arrangement is often referred to as “Consignment Inventory” since Amazon takes possession of the goods without owning them. Consequently, these consigned goods must remain on the balance sheet and be managed in NetSuite as if they are located in another warehouse.   Conceptually, simple enough.

NetSuite’s Transfer Order serves as the planning document for transferring inventory between warehouses. However, integrating this process with Amazon’s FBA program manually introduces complexity beyond the straightforward fulfillment and receipt logic of a typical Transfer Order and its respective item fulfillment and item receipt records. Our client initially tried to streamline this process using the Celigo.io FBA Inbound Shipments (Add-in) connector but found the solution lacking coherence.

In response to the client’s call for help, we employed our thorough service approach to analyze their business and inventory logistics needs. Our goal was to craft a seamless, automated workflow, complete with detailed status tracking, to provide planners and inventory managers with a comprehensive solution.  As we reviewed the Celigo add-on, we recognized that we could model the challenge better and produce full automation as we understood the coordination challenges intimately.

Centralizing Operations with NetSuite as a Hub Architecture

In aiding our clients’ business expansion, we consistently recommend a technology setup where NetSuite serves as the central node for all Order, Inventory, and Financial processes. This approach ensures that management has a unified platform to oversee procurement, inventory management, and fulfillment activities.  Our clients recognize they need this when they are ready to scale their operations.  Integrating the Amazon sales channel is crucial, ensuring it’s seamlessly connected with other sales avenues rather than being siloed.   Too many times we have seen clients try to wire up the warehouse directly to Amazon forcing NetSuite then to try and follow the flows.

In past projects, we’ve successfully engineered and refined integrations for our clients with major third-party logistics providers, such as XB Fulfillment, for their North American inventory operations. Similar initiatives were undertaken to facilitate distribution in Europe and Australia, as detailed in my 2018 article on NetSuite warehouse management systems integration patterns.

Viewing Amazon as an additional third-party logistics provider aligns with this strategy. Primarily, the task involved transferring inventory from XB, where the bulk of the stock was stored, to Amazon’s warehouses for order fulfillment. This process, termed replenishment by us, is referred to as Inbound Shipments by Amazon.

Navigating Amazon Seller Central Inbound Shipment Complexity

Transferring inventory to Amazon Seller Central is a multifaceted process, largely due to Amazon’s extensive fulfillment network, which is a cornerstone of its competitive edge. Amazon employs sophisticated algorithms to allocate inventory across their warehouses, optimizing based on anticipated demand and supply dynamics gathered from sales data on their platform.

To facilitate the movement of goods from a traditional 3PL warehouse to Amazon’s facilities, several coordinated steps are required:

  1. Transfer Order Creation: Initiating the process, a NetSuite transfer order outlines the intention to move inventory from a 3PL provider, like XB, to Amazon. This document supports shipping logistics from the originating warehouse and acknowledges receipt at Amazon’s end.  Simple enough.
  2. Amazon Inbound Shipment Plans: Complexity begins: upon specifying the intended replenishment quantities in the Transfer Order, Amazon’s system generates a distribution plan across its warehouse network. This often involves allocating specific product quantities to multiple warehouses, complicating the transfer process as each destination will require a separate shipment. In Amazon’s case, the “Amazon Consignment” NetSuite Location record is virtual; the actual addresses for each warehouse location will be specified by Amazon in this step. For reference, this requires calling Amazon Seller Central API calls: createInboundShipmentPlan and createInboundShipment.
  3. Packaging Specifications: Amazon requires detailed information about the forthcoming shipment, including the number of boxes, dimensions, and weights. This data, essential for logistical planning and carrier label generation, must be relayed to and from the 3PL provider responsible for the physical packing.  More complexity: we need to plan with the 3PL warehouse.
  4. Amazon Transport Arrangements: With the packaging details in hand, Amazon’s APIs facilitate the preparation for receiving the shipment. This involves coordinating with carriers like UPS to secure transport costs and generate shipping labels for each/distinct shipment to Amazon’s warehouses. For reference, this requires calling Amazon Seller Central API calls: putTransportDetais, estimateTransport, getTransportDetails, confirmTransport, and getLabels.
  5. Label Retrieval and Distribution: More complexity.  Amazon provides carrier labels for each package, which must be efficiently retrieved and forwarded to the 3PL warehouse for use in the shipping process. The brief API window for label retrieval and the subsequent distribution to the warehouse requires precise timing and coordination. Note that this is a technically tricky operation because the Amazon APIs offers a limited window (15 seconds) to retrieve the label. We hold the label as a binary image file in the NetSuite file cabinet and then transmit the file for retrieval to the XB warehouse by URL. The label binary file distribution must be carefully coordinated with the 3PL warehouse.
  6. Shipment and Tracking: The 3PL warehouse proceeds with packaging and hands off the goods to the carrier, utilizing the provided labels. This step integrates seamlessly with our client’s existing NetSuite 3PL integration, allowing for the capture and recording of tracking information within NetSuite’s Transfer Order Record.  We also inform Amazon that the shipment now is coming.   For reference, this requires calling the Amazon Seller Central API: updateInboundShipment
  7. Monitoring Amazon’s Receipts: The final phase involves regularly checking (polling) Amazon Seller Central’s API to confirm the receipt of shipments. Completion of all shipments and the creation of item receipt records in NetSuite marks the end of the transfer order effort. For reference, this requires calling Amazon Seller Central API calls: updateInboundShipment and getShipments.

To manage this intricate process, we developed a comprehensive Amazon Integration Data record to streamline API interactions, ensure data consistency across all steps, and maintain robust error handling. This ensures clarity and control throughout the entire shipment process.

For a visual understanding of this workflow, viewing the related image will provide a clearer picture of the involved steps and their interconnections.

Exploring NetSuite Amazon FBA Transfer Order Integration Through a Demo

To showcase the intricacies of our NetSuite Amazon FBA Transfer Order integration, we’ve created a detailed demonstration video (20:43), inspired by our consultations with our client’s inventory planning team.  A special thanks go to Jacob P., Operations Practice Business Analyst, and Chidi O., Technology Service Manager, for their exceptional client service and leadership.  Their expertise is highlighted throughout this video, providing valuable insights into the integration process.

Click here if the video does not load.

Alternative Open-Source Inspired Model for NetSuite Amazon FBA Integration

Our unique approach to this NetSuite Amazon integration sets us apart in the marketplace. Rather than selling a proprietary software solution, we provide our clients with these algorithms without licensing fees, embracing a model reminiscent of the open-source community.  This approach allows for the free modification and customization of the software, empowering our clients to kickstart their implementations effectively.  We call this Prolecto Labs.

While third-party integration tools have their place, the capabilities inherent in the NetSuite platform are extensive — when you know how to tap into them. Our firm excels in maximizing the value of existing NetSuite investments, enabling our clients to achieve greater returns without incurring ongoing costs. Our philosophy, detailed in my 2022 article, Contrast Platform vs NetSuite Point-to-Point Integration Options, advocates this approach; our clients gain considerable capacity at a lower overall cost of ownership.

It’s worth noting that our open-source-like approach extends beyond just Amazon warehouse integration to include Amazon accounting integrations within NetSuite, as discussed in my 2023 article, Avoid Recurring Fees with Seamless NetSuite Accounting Between Amazon Seller Central.  This underscores our commitment to providing comprehensive, cost-effective integration solutions and competitive alternatives to highly marketed recurring cost product options.

At the core, successful software implementation is the key to realizing a fully automated ecosystem that seamlessly connects NetSuite, Amazon, and warehouse operations.  Our firm is recognized for its expertise and leadership in complex NetSuite-centric business processes and accounting. Our clients benefit from our team’s deep understanding of both the technical and ethical aspects of project leadership while we invest to ensure we offer a high competency level in NetSuite ERP implementations and optimizations.

If you found this article relevant, feel free to sign up for notifications to new articles as I post them.  If you are ready to tackle your NetSuite Amazon Integration, let’s have a conversation.

Marty Zigman

Holding all three official certifications, Marty is regarded as the top NetSuite expert and leads a team of senior professionals at Prolecto Resources, Inc. He is a former Deloitte & Touche CPA and has held CTO roles. For over 30 years, Marty has produced leadership in ERP, CRM and eCommerce business systems. Contact Marty to set up a conversation.

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About Marty Zigman

Marty Zigman

Holding all three official certifications, Marty is regarded as the top NetSuite expert and leads a team of senior professionals at Prolecto Resources, Inc. He is a former Deloitte & Touche CPA and has held CTO roles. For over 30 years, Marty has produced leadership in ERP, CRM and eCommerce business systems. Contact Marty to set up a conversation.

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