diff --git a/docs/recipes/precompiling-with-webpack.md b/docs/recipes/precompiling-with-webpack.md
index ef11376ab..fdad2f83a 100644
--- a/docs/recipes/precompiling-with-webpack.md
+++ b/docs/recipes/precompiling-with-webpack.md
@@ -2,25 +2,33 @@
 
 Translations: [Français](https://github.com/avajs/ava-docs/blob/master/fr_FR/docs/recipes/precompiling-with-webpack.md)
 
-The AVA [readme](https://github.com/avajs/ava#transpiling-imported-modules) mentions precompiling your imported modules as an alternative to runtime compilation, but it doesn't explain how. This recipe shows how to do this using webpack. (This example uses webpack 2.0)
+The AVA [readme](https://github.com/avajs/ava#transpiling-imported-modules) mentions precompiling your imported modules as an alternative to runtime compilation, but it doesn't explain how. This recipe discusses several approaches using webpack v2. Multiple approaches are discussed as each has its own pros and cons. You should select the approach that best fits your use case. See the original discussion [here](https://github.com/avajs/ava/pull/1385).
+
+- [Single test file](#single-test-file)
+- [Multiple test files](#multiple-test-files)
+
+### Single test file
+This is the simplest use case. You might need this if you are [using aliases](https://github.com/avajs/ava/issues/1011).
 
 ###### webpack.config.js
 
 ```js
+const path = require('path');
 const nodeExternals = require('webpack-node-externals');
 
 module.exports = {
-	entry: ['src/tests.js'],
+	entry: ['test.js'],
 	target: 'node',
 	output: {
-		path: '_build',
-		filename: 'tests.js'
+		path: path.resolve(__dirname, '_build'),
+		filename: 'test.js'
 	},
 	externals: [nodeExternals()],
 	module: {
 		rules: [{
-				test: /\.(js|jsx)$/,
-				use: 'babel-loader'
+			test: /\.(js|jsx)$/,
+			use: 'babel-loader',
+			options: { cacheDirectory: true }
 		}]
 	}
 };
@@ -28,4 +36,224 @@ module.exports = {
 
 The important bits are `target: 'node'`, which ignores Node.js-specific `require`s (e.g. `fs`, `path`, etc.) and `externals: nodeModules` which prevents webpack from trying to bundle external Node.js modules which it may choke on.
 
-You can now run `$ ava _build/tests.js` to run the tests contained in this output.
+You can now run `$ ava _build/test.js` to run the tests contained in this output.
+
+### Multiple test files
+Things are a little more complicated with multiple test files. We recommend [using babel-register](babelrc.md) until the performance penalty becomes too great.
+
+The possible approaches are:
+
+- [Refer precompiled source in tests](#refer-precompiled-source-in-tests)
+- [Single entry file](#single-entry-file)
+- [Multiple entry files](#multiple-entry-files)
+- [Test against precompiled sources](#test-against-precompiled-sources)
+
+#### Refer precompiled source in tests
+Source files can be compiled to `_src` folder and referenced in tests. While this is less than elegant, it performs well and the workflow can be optimized with [`babel-cli` watch mode](https://babeljs.io/docs/usage/cli/#babel).
+
+```js
+// Before
+import fresh from '../src';
+// After
+import fresh from '../_src';
+```
+
+#### Single entry file
+Multiple test files can be compiled into a single file. This may have the best performance but that does come at a cost. All tests will be in the same file, which can make it harder to know which test has failed, since AVA can't show the file name the test was originally in. You'll also lose [process isolation](https://github.com/avajs/ava#process-isolation).
+
+###### webpack.config.js
+
+[Related stackoverflow answer](http://stackoverflow.com/questions/32874025/how-to-add-wildcard-mapping-in-entry-of-webpack/34545812#34545812)
+
+```js
+const path = require('path');
+const glob = require('glob');
+
+const nodeExternals = require('webpack-node-externals');
+
+module.exports = {
+	target: 'node',
+	entry: glob.sync('./test/**/*.js'),
+	output: {
+		path: path.resolve(__dirname, '_build'),
+		filename: 'tests.js'
+	},
+	externals: [nodeExternals()],
+	module: {
+		rules: [{
+			test: /\.(js|jsx)$/,
+			use: {
+				loader: 'babel-loader',
+				options: { cacheDirectory: true }
+			}
+		}]
+	}
+};
+```
+
+<details>
+<summary>Error report comparison</summary>
+
+```
+# Before
+  aggregations-test » cardinality-agg » sets precision_threshold option
+  E:\Projects\repos\elastic-builder\test\_macros.js:167
+
+   166:         const expected = getExpected(keyName, recursiveToJSON(propValue));
+   167:         t.deepEqual(value, expected);
+   168:     }
+
+  Difference:
+
+      Object {
+        my_agg: Object {
+          cardinality: Object {
+    -       precision_threshol: 5000,
+    +       precision_threshold: 5000,
+          },
+        },
+      }
+
+# After
+  sets precision_threshold option
+  E:\Projects\repos\elastic-builder\_build\tests.js:106
+
+   105:                     column: 21
+   106:                 }
+   107:             },
+
+  Difference:
+
+      Object {
+        my_agg: Object {
+          cardinality: Object {
+    -       precision_threshol: 5000,
+    +       precision_threshold: 5000,
+          },
+        },
+      }
+
+```
+
+</details>
+
+#### Multiple entry files
+We can ask webpack to generate multiple entry files. This helps retain file names so that error reports are easy to interpret. But each entry file gets it's own copy of the source files. This results in considerably larger file sizes. This can [perform quite poorly](https://github.com/avajs/ava/pull/1385#issuecomment-304684047) on the first execution.
+
+###### webpack.config.js
+
+```js
+const path = require('path');
+const glob = require('glob');
+
+const nodeExternals = require('webpack-node-externals');
+
+const entryObj = glob.sync('./test/**/*.js')
+    .reduce((acc, file) => {
+        acc[path.basename(file, path.extname(file))] = file;
+        return acc;
+    }, {}); // empty object as initial value
+
+module.exports = {
+	target: 'node',
+	entry: entryObj,
+	output: {
+		path: path.resolve(__dirname, '_build'),
+		filename: '[name].js'
+	},
+	externals: [nodeExternals()],
+	module: {
+		rules: [{
+			test: /\.(js|jsx)$/,
+			use: {
+				loader: 'babel-loader',
+				options: { cacheDirectory: true }
+			}
+		}]
+	}
+};
+```
+
+#### Test against precompiled sources
+This is the most complicated to setup but performs quite well and also retains file names. In this approach, we use the `babel-cli` to compile the source files but preserve file structure. Require paths in tests are rewritten when compiling them in webpack. The following example is for a specific file structure. Depending on how your source and test files are organised, you might need to make changes.
+
+File structure:
+```
+├───src
+│   ├───my-pkg-fldr
+│   │   ├───my-module.js
+│   │   └───index.js
+│   └───index.js
+└───test
+    ├───my-pkg-fldr
+    │   └───my-module.test.js
+    └───index.test.js
+
+# Generated file structure
+├───_src
+│   ├───my-pkg-fldr
+│   │   ├───my-module.js
+│   │   └───index.js
+│   └───index.js
+└───_build
+    ├───my-module.test.js
+    └───index.test.js
+```
+
+npm scripts:
+```js
+{
+  "scripts": {
+    "precompile-src": "cross-env NODE_ENV=test babel src --out-dir _src",
+    "precompile-tests": "cross-env NODE_ENV=test webpack --config webpack.config.test.js",
+    "pretest": "npm run precompile-src && npm run precompile-tests",
+    "test": "cross-env NODE_ENV=test nyc --cache ava _build --concurrency 3"
+  }
+}
+```
+
+###### webpack.config.js
+
+Webpack Externals Docs - https://webpack.js.org/configuration/externals/#function
+
+```js
+const path = require('path');
+const glob = require('glob');
+
+const nodeExternals = require('webpack-node-externals');
+
+const entryObj = glob.sync('./test/**/*.js')
+    .reduce((acc, file) => {
+        acc[path.basename(file, path.extname(file))] = file;
+        return acc;
+    }, {}); // empty object as initial value
+
+
+module.exports = {
+	target: 'node',
+	entry: entryObj,
+	output: {
+		path: path.resolve(__dirname, '_build'),
+		filename: '[name].js'
+	},
+	externals: [
+		nodeExternals(),
+		// Rewrite the require paths to use _src
+		(context, request, callback) => {
+			// This is a little messy because tests are not output in original file structure
+			// test/index.test.js -> _build/index.test.js
+				// => ../src -> ../_src
+			// test/my-pkg-fldr/my-module.test.js -> _build/my-module.test.js
+				// => ../../src -> ../_src
+			if (request.includes('/src')) {
+				const requestReqwrite = request
+					.replace('/src', '/_src')
+					.replace('../../_src', '../_src');
+				return callback(null, `commonjs ${requestReqwrite}`);
+			}
+			callback();
+		}
+	]
+};
+```
+