Multi-Warehouse Inventory Allocation

When One Warehouse Stops Being Enough

Most ecommerce brands start with a single warehouse. It is simple, predictable, and easy to monitor. But as order volume grows, and customers spread across regions, that single node turns into a bottleneck. Transit times stretch. Shipping costs balloon. SLAs wobble. At that point, multi-warehouse inventory allocation stops being a future project and becomes an immediate operational necessity.

Adding warehouses is the easy part. Allocating inventory across them without creating stockouts, overstocks, or chaos is the challenge. Multi-warehouse inventory allocation is the art and science of deciding which SKUs should live where, in what quantities, and for how long. Do it well and your shipping becomes faster and cheaper. Do it poorly and you burn cash while confusing your customers and your warehouse teams.

Why Multi-Warehouse Operations Often Go Wrong

Operating multiple warehouses creates complexity that many brands underestimate. Without a unified system, each node becomes its own island. Inventory data drifts. Transfers become messy. Orders route incorrectly. Forecasting breaks. Regional stockouts occur even while another node drowns in excess inventory.

Maureen Milligan, Director of Operations and Projects at G10, sees this repeatedly. She says that "most of the customers who come to us from another 3PL, their challenges have always been access to their data, order accuracy and efficiency, and meeting the committed requirements." Those challenges multiply in multi-warehouse setups.

Unified Inventory, Not Islands

The foundation of multi-warehouse inventory allocation is a single source of truth. Every receipt, transfer, pick, pack, and return must feed the same WMS. Without that, you are managing shadows instead of real stock.

Connor Perkins, Director of Fulfillment at G10, summarizes the rule that keeps multi-node networks sane: "you want everything to be scanned in the warehouse, nothing done on paper." Scanning ensures that each movement updates ChannelPoint instantly, preventing the drift that destroys allocation strategies.

Forecasting That Reflects Regional Demand

Multi-warehouse allocation requires forecasting that does more than estimate total demand. It must predict where demand will occur. A brand with strong West Coast sales needs inventory in Nevada or Arizona. A brand with heavy Midwestern demand needs stock in Wisconsin. Sending all inventory to a single node and hoping demand distributions stay stable is a recipe for slow shipping and unhappy customers.

G10 uses regional order data across its facilities in South Carolina, Wisconsin, Nevada, Arizona, and Texas to position SKUs intelligently. That reduces shipping zones and stabilizes delivery windows.

Allocation Rules That Adapt to SKU Behavior

Not all SKUs deserve equal real estate in every warehouse. Fast movers get multi-node coverage. Slow movers might stay centralized. HAZMAT items require specialized storage. Oversized items need appropriate racking and lane design. Allocation rules inside ChannelPoint reflect these differences so inventory placement matches real operational needs.

Joel Malmquist, VP of Customer Experience at G10, explains that the WMS ties DTC, marketplace, and B2B flows together through "direct integration with Shopify" and the same backbone supporting "B2B shipping into places like Target and Walmart." That unified logic ensures allocation rules support all channels, not just DTC.

Transfers Without Chaos

Multi-warehouse networks rely on transfers. The danger is that transfers can become a game of inventory ping pong if poorly planned. G10 uses transfer logic based on true demand, not gut feeling. If one node is running low while another sits heavy, stock transfers occur proactively. But transfers do not happen just because a planner feels nervous. They happen because the data supports the move.

Clean transfers also require disciplined receiving. Connor’s scanning-first rule ensures that transferred units do not disappear into paperwork or get mis-slotted, which is a common failure in multi-node setups.

Routing Optimization and SLA Protection

Multi-warehouse allocation only matters if orders route correctly. ChannelPoint automatically assigns orders to the node that can ship fastest and cheapest while still hitting SLAs. The system considers inventory availability, regional speed, and carrier performance before making the decision.

This prevents the classic mistake of sending orders to overloaded or distant nodes simply because they received inventory first.

Multi-Node Returns Without Double Counting

Returns complicate multi-warehouse inventory allocation. Many brands ship from several warehouses but return to only one, creating imbalances. Others return to multiple warehouses but do not track those flows effectively. G10’s returns process ties every return to a specific SKU, order, and node so inventory accuracy holds across locations.

Joel explains how returns are classified: "it looks good, we are going to restock this, or it looks damaged, we are going to either dispose of it or put it in a quarantine area." That clarity is crucial when returns feed multiple nodes.

Scaling Allocation as the Catalog Grows

As catalogs expand, multi-warehouse inventory allocation grows more complex. New SKUs need initial placement. Existing SKUs need revised placement. Promotional items need temporary shifts. Seasonal SKUs need cyclical adjustments. G10 revisits allocation logic regularly to align with changing velocity patterns.

Holly Woods, Director of Operations, reinforces the role of forecasting in this process. "We start planning peak times months ahead of time. We run forecast models, staffing models, and we audit inventory." Those audits inform allocation shifts long before peak hits.

Turning Multi-Warehouse Complexity Into Competitive Advantage

A well-run multi-warehouse network shortens transit times, lowers shipping cost, and protects SLAs. A poorly run network creates confusion, waste, and unhappy customers. The difference is clean data, good forecasting, disciplined scanning, and a WMS designed for multi-node orchestration.

Mark Becker, CEO and founder of G10, summarizes the mindset behind successful scaling: "we are going to grow with them." Multi-warehouse inventory allocation is one of the most powerful ways to support that growth. If your single-node setup is feeling strained, or your multi-node network feels chaotic, now is the time to build allocation rules that make your footprint stronger instead of more complicated.