Fulfillment services are an ideal solution for all types of businesses, from startups and crowdfunding projects to large online retailers. But not just any 3PL (third party logistics) company will do. In this article, we’ll show you how to find the best fulfillment company based on your business’s specific needs. We’ll also compare four top fulfillment services: ShipBob, FulfillmentCompanies.net, Red Stag, and Fulfillment by Amazon, and show you what to expect in terms of fulfillment costs and fees.
Best Small Business Fulfillment Center & 3PL Service: ShipBob
ShipBob is an emerging star in the fulfillment industry and is laser-focused on giving small businesses a top-notch fulfillment service for less. ShipBob has some of the lowest fulfillment rates, plus fast onboarding and low to no startup costs. ShipBob also fills a niche for crowdfunding fulfillment services by giving these projects an affordable way to ship large numbers of backer rewards or pre-orders all at once.
Best Service for Finding Fulfillment Centers & 3PL Partners: FulfillmentCompanies.net
We recommend starting any search for a fulfillment center and 3pl service by first speaking with FulfillmentCompanies.net. They’re not a fulfillment company – they’re a fulfillment matchmaker.
Why should you start here? Because your order fulfillment center is a key partner in your operation and tasked with all of your business-critical logistics. Since their role directly impacts your success, it’s crucial to find a fulfillment company that fits your unique needs.
Fulfillment warehouses offer many business-specific services and specialties, and you need to consider these factors when screening potential partners. This is where FulfillmentCompanies.net can help tremendously. They review your needs, then match you to select candidates from over 500 prescreened national and regional fulfillment centers. It’s completely free and you can get started by filling out a short survey:
Best Fulfillment Center & 3PL Service for Heavy or Valuable Goods: Red Stag Fulfillment
Red Stag is our recommended fulfillment company for oversized products, orders over five pounds, high-value or fragile goods (like luxury watches), and items that require light assembly or customization prior to shipment.
Red Stag negotiated a great deal with FedEx that allows them to ship heavy and oversized items at significant discounts. They also have cutting-edge quality control systems that video tracks their warehouse and packing areas to prevent loss, packing errors, and shipping damage. And if there’s a mistake on their end? They pay you $50 per occurrence.
Best Fulfillment Center for Amazon Sellers: Fulfillment by Amazon (FBA)
Amazon gives retailers access to a vast customer base and makes it easy for small sellers to expand into global sales. If your small business uses Amazon’s marketplace for some or all of your sales, using Fulfillment by Amazon (FBA) is a no-brainer.
While Amazon’s steep seller fees average about 15% of every sale, FBA’s fulfillment and shipping costs are deeply discounted for all Amazon sellers. Plus with FBA, your products are eligible for sales-drivers like Amazon Prime and other Free Shipping offers.
How To Evaluate Fulfillment Services & In-Depth Comparison
Whether you’re starting your search with FulfillmentCompanies.net, or are interested in working with ShipBob, Red Stag Fulfillment, or Fulfillment by Amazon, it’s important to understand the basic services that fulfillment companies offer. We’ll cover the services common to all fulfillment companies below and you can learn even more in our article about how fulfillment companies work.
Once you decide a fulfillment center is right for your business, you need to consider three primary things as you research potential fulfillment partners:
- How to they charge for fulfillment services? What are those costs?
- Do they specialize in fulfillment for businesses like yours?
- What requirements, like order volume, do you need to meet?
Here’s a closer look at each:
Consideration #1: Fulfillment Company & 3PL Warehouse Costs
There are four primary fees most fulfillment companies charge for their services:
|Fee Type||Avg. Amount||Description|
|Receiving Fees||$0 - $35 per pallet||The cost of receiving, unloading and sorting product shipments as they arrive at the fulfillment warehouse.|
|Inventory Storage Fees||$15 - $40 a month per pallet||The cost of keeping your goods in their warehouse. Your goods are stored on pallets or shelved units (called bins) and usually priced per pallet or per bin.|
|Pick & Pack Fees||$0 - $3 per package||The charge for warehouse employees to pick stock, pack orders, and label boxes for shipment.|
|Shipping Fees||Up to 50% off standard rates||Inbound: The cost of shipping your inventory to your fulfillment company.
Outbound: The cost of shipping your customers’ orders.
Note! Fulfillment Center Fees Can Vary Widely
As shown above, fulfillment companies don’t have industry-wide uniformity when it comes to costs. In fact, how a company charges you can make a huge difference in whether they’re the right company for your business.
Here are a few ways fees can vary for these primary fulfillment services.
Fulfillment Center & 3PL Warehouse Cost Variations
|Fee Type||Charge Variations|
|Receiving Fees||By pallet; by full-truckload (FTL); by less-than-truckload (LTL); by tracking order; by container; by parcel; etc.|
|Storage Fees||By pallet, ½ pallet, or ¼ pallet; by bin; by cubed-foot; by duration; by season; by SKU; etc.|
|Pick and Pack Fees||By item; by order; by weight / dimension; etc.|
|Shipping Fees||By weight; by dimensional weight; discounted vs. standard; etc.|
Now you see why it’s critical to ask the right questions and fully understand your fulfillment fees and costs before committing to a fulfillment company. Below, you can see how these fees differ among our top fulfillment company picks.
Fulfillment Center & 3PL Warehouse Costs: Top Picks Compared
Bin: $5 per month
½ Pallet: $7.50/month
¼ Pallet: $3.75/month
Pickable Shelf Location: $1.25 per month
cubic foot, averages : 64¢ - $2.15 per month
Learn more about FBA storage costs
|Pick & Pack ||Included in your shipping fee||$2.55 first item |
+ 30¢ per additional item per order
|Standard: $2.41 - $4.18
Oversize: $6.85 and up
Learn more about FBA packing fees
|Inbound & Outbound Shipping|
Outbound: Discounted up to 45% off FedEx’s standard rates.
Looking at this table, you can see that ShipBob’s low receiving and pick & pack charges make it a great choice for companies with quick inventory turnover. However, if your business has slower inventory turnover, the lower monthly storage fees at Red Stag might be the better bargain. And if you sell on Amazon, it’s nearly impossible to beat FBA’s rates.
You may encounter fees in addition to these four basic fulfillment costs, so be sure to ask about other costs when you interview potential partners. For example, if you ship hazardous materials, require climate-controlled storage, or have product assembly or kitting needs, you may face added fulfillment costs. For a more in-depth look at fulfillment company pricing, take a look at our article about how fulfillment companies work.
Consideration #2: Fulfillment Company & 3PL Specialties
Like any business, fulfillment companies often fill a niche. Some specialize in working with companies of a certain size while others handle products that require specific facilities or shipping expertise. One may be ideal for apparel fulfillment, which requires high-SKU stock management of size and color options. Another may specialize in perishable foods or cosmetics, which are subject to shelf-life and storage regulations.
Similarly, fulfillment companies often have strengths that give them a unique logistical advantage. Some are focused on delivery speed and offer same-day shipping of orders from a nationwide warehouse network. Others offer high degrees of storage and packing security for high-value goods. Still others are well-versed in international shipping or offer custom kitting services that enhance your customer’s unboxing experience.
Here are a few fulfillment specialty areas where our top picks excel.
Batch Shipping, Crowdfunding Fulfillment & Flexibility
ShipBob offers batch fulfillment services that help small businesses avoid costly storage fees. If your small business just finished a Kickstarter crowdfunding campaign or other promotion you likely need to fulfill a large number of orders at one time. ShipBob can plan ahead to fulfill these orders as a batch project which cuts your storage fees. ShipBob also understands that small businesses need more flexibility in storing and accessing their inventory, especially for those that sell at frequent pop-up stores, craft fairs, etc.
Most fulfillment companies support ecommerce integrations, either directly or via API. Both Red Stag and ShipBob directly integrate with two of our preferred ecommerce platforms, Bigcommerce and Shopify. They also both integrate with many others via API. This means orders are automatically forwarded to the fulfillment company as soon as they’re placed on your website. Additionally, most fulfillment companies can use standardized XML files to receive your customer orders in bulk.
Heavy, Valuable & Kitted Products
Red Stag Fulfillment is a “premier” fulfillment service with one of the highest accuracy rates in the industry. They use a highly tracked, video-monitored packing system that reduces errors to 1 in every 150,000 packages. By placing video cameras over each packing station, Red Stag helps protects businesses from customer claims of inaccurate orders. This reduces theft and fraud and saves its clients money. Via an exclusive deal with FedEx, Red Stag offers deeply discounted shipping rates on heavy and oversized shipments. They also have competitive rates for orders requiring custom kitting or light assembly.
Note! This is just a sampling of specialties that fulfillment companies offer. FulfillmentCompanies.net actually considers over 45 specialty factors when pairing a business with fulfillment services. That’s why they’re a great place to start your fulfillment company search.
Consideration #3: Fulfillment Company & 3PL Requirements
Working with a fulfillment company is essentially a partnership that involves your business’s critical logistics. Obviously picking the right partner is important to you, but fulfillment companies feel the same. Since most have no startup fees, they make an investment in every client they bring on. Plus, they need to cover their costs, make a profit, and preserve their reputation. To ensure this, they have certain requirements for their clients. Here are two that top the list:
Minimum Order Requirement
Most order fulfillment centers want clients who have been in business for at least a little while and have an average volume of 100+ orders per month. This ensures a certain level of monthly revenue and limits their exposure to businesses with tight cash flow and an uncertain outlook. Not quite there yet? Learn how to handle in-house fulfillment until you reach these minimums.
Minimum or Maximum Number of SKUs
Another common requirement is a minimum or maximum number of SKUs, or unique products. SKU stands for stock keeping unit, and every unique item stocked by a fulfillment center is considered a unique SKU. Why do SKUs matter? Let’s say you sell 10 styles of shoes, but each style is available in 5 different colors and 10 different sizes. This means you have 500 different SKUs (10 styles x 5 colors x 10 sizes) and require 500 storage units in your fulfillment warehouse. SKUs add up fast!
Consider an average sports apparel retailer selling thousands of products that come in many sizes and colors. Now you can imagine how many unique items high-SKU fulfillment companies must accurately store, track, pick, and ship.
Some fulfillment centers have facilities and systems specially designed to provide the best service and value to volume-SKU clients. Others might have a lower-SKU storage system but a full range of packing services for specialty needs. Each is best suited for different sellers.
In-Depth Comparison: ShipBob, Red Stag, Fulfillment by Amazon (FBA), & FulfillmentCompanies.com
ShipBob: Detailed Overview
Now that you have a basic understanding of what goes into finding the right fulfillment company, let’s review what makes ShipBob stand out as a top fulfillment partner for small businesses:
- No Pick and Pack Fees: Unlike fulfillment companies that charge pick and pack fees that can cost up to $3 per order, ShipBob takes a unique approach and drops this charge altogether. All you pay is a $5/month storage fee per bin (typically 1 bin per SKU, or unique item), or $40/month per pallet if you have a larger inventory, plus your package shipping fees.
- Flat Rate Receiving: In most cases, ShipBob charges a flat-rate fee of $35 per delivery rather than charging per pallet or other unit received. This lets businesses consolidate deliveries and reduce fulfillment costs significantly.
- Batch Fulfillment: Batch projects are ideal for shipping orders in bulk, like backer rewards for Kickstarter-style crowdfunding campaigns, product launches, and marketing promotions. ShipBob receives the products, then packages and ships everything in a single batch. There’s no onboarding cost or storage fees – you just pay a flat $35 for receiving the stock, plus $1 per shipment and shipping fees.
The downside to ShipBob? Because there are no pick and pack fees, their storage rates can be higher than other services. If your inventory has a speedy turnover and you don’t have a huge number of SKUs, this isn’t a problem. On the other hand, businesses with long-term inventory storage or high SKU counts may find savings with a 3PL company with lower storage fees.
Red Stag Fulfillment: Detailed Overview
Red Stag is a fulfillment company with lower storage fees than many, so it’s a good option for businesses with slower inventory turnover. But their big advantage is in fulfillment for goods that are heavy, valuable, or require kitting, light assembly, or customization before shipping. Here’s a closer look:
- Affordable Storage: Some businesses turn lots of stock quickly, others sell in lower volume and need to store stock longer. So sometimes, working with a fulfillment company with affordable storage fees can outweigh their higher receiving, pick, and pack fees. At $15 per month per pallet, plus a range of lower-priced partial pallet and bin sizes, Red Stag’s storage is very affordable and flexibility that’s hard to beat.
- Heavy Products: Shipping rates are a huge part of fulfillment cost. The bigger and heavier the product, the bigger your shipping bill. For these sellers, specifically negotiated rates for heavy or oversized shipments is a game changer. Red Stag’s deal with FedEx saves its clients up to 45%-off shipping rates and makes them a top choice for sellers of everything from bowling balls to gas grills.
- High-Value Goods: Red Stag has a stringent quality control process that caters to sellers of high-value products. All storage, packing, and shipping areas are video-tracked to prevent theft, packing errors, shipping damage, and even losses due to customer fraud. And if there’s a mistake on their end? They pay you $50 per occurrence.
- Kitting & Light Assembly: For goods that require assembly or customization before shipping, or custom packaging, a fulfillment partner with capable staff and affordable kitting rates is key. Red Stag provides this type of service on both a batch and per-order basis with a set fee based on an efficiency study so there are no surprises.
Red Stag is a great niche service for those shipping heavy, oversized, or luxury items. But what if you have a high SKU count of lighter, low-cost products that require no customization? That’s when a fulfillment company matchmaker like FulfillmentCompanies.net can help.
Fulfillment by Amazon (FBA): Detailed Overview
If you primarily sell on Amazon, versus your own website, and sell more than 40 items per month, Fulfillment by Amazon (FBA) is the ideal fulfillment solution for you. Here’s why:
- Low Cost for Amazon Sellers: FBA caters to Amazon sellers for several reasons, and thus FBA’s storage, packing, and shipping fees generally cost far less than other fulfillment services. Not sure how they stack up for your needs? Use this calculator to compare costs.
- Prime Free 2-Day Shipping: FBA makes your products eligible for free 2-day shipping for Amazon Prime customers. This means your product is listed on Amazon with the Prime logo, which is a proven to drive higher sales than non-Prime products.
- Other Shipping Deals & Promotions: FBA makes your products eligible for other Amazon free shipping offers available to non-Prime customers that meet minimum order amounts: $25 for books or $35 for other eligible products.
- Shoppers Trust Amazon: FBA attaches the Amazon shipping experience to your order which drives sales. Sorry! Shoppers know and trust Amazon’s brand more than yours. Product listings that state Fulfillment by Amazon gives buyers confidence knowing that Amazon, not an unknown third party, is shipping their order.
Amazon FBA leverages Amazon’s brand, the Prime loyalty program, and other sales-boosting perks on Amazon.com. For Amazon sellers, FBA offers low storage, packing, and shipping rates, plus seamless, hands-off order processing. If you’re an Amazon seller and not using FBA, you’re likely losing sales to your FBA competitors.
FulfillmentCompanies.net: Detailed Overview
For businesses that don’t fit neatly into the fulfillment specialties discussed above, we recommend using the matchmaking service FulfillmentCompanies.net. We make this recommendation for a number of reasons:
- Low Rates Matter: There are a lot of potential fees when it comes to fulfillment, and many new to the process don’t know what to ask or where to find the loopholes. It’s easy to be distracted by certain high or low fees that, in the end, may not make a difference per your needs. A fulfillment matchmaker can help identify your needs and the related fees to expect when searching for a fulfillment partner.
- Industry Expertise: Whether you’re selling apparel, books, car parts, or nutritional supplements, you want a 3PL company that has experience storing and shipping your products. Fulfillment Companies has vetted more than 500 potential partners to help you find the perfect match.
- Shipping Expertise: To offer same-day or next-day shipping within a certain region or nationwide, fulfillment warehouse location is key. Similarly, for sellers focusing on overseas and international shipping, a fulfillment company with international shipping and consolidation expertise or even overseas facilities is an ideal choice.
FulfillmentCompanies.net reviews your specific needs, then matches you with suitable services from more than 500 prescreened national and regional fulfillment companies. It’s completely free to use and you can get started by outlining your needs in a short survey:
Other Fulfillment Center Options
The fulfillment companies covered above meet the needs of many small businesses, but they are far from the only top-notch players in the 3PL industry. Here is a look at all of the fulfillment centers we reviewed for this guide:
|Fulfillment Company||Best for|
|Shipbob||Startups, small sellers & crowdfunding campaigns with under 1000 unique skus|
|FulfillmentCompanies.net||Custom-tailored solutions to match specific storage, volume, shipping & budget needs|
|Red Stag||Sellers shipping high-value, oversized, heavy, or special-handling products|
|Fulfillment by Amazon (FBA)||Amazon sellers & ecommerce companies selling via Amazon and other sales channels|
|Fulfillify||All types of shippers plus subscription box businesses needing custom packaging design & printing|
|IDS Fulfillment||All types of shippers, ideal for those needing special handling like food-grade fulfillment|
|Ships-a-Lot||High-volume Shopify sellers and crowdfunding campaigns needing large batch fulfillment|
|VelocityShip||Small and large ecommerce sellers including subscription box businesses|
|FedEx Fulfillment||Multichannel sellers and international sellers looking for an alternative to FBA|
|Fulfillment.com||Companies needing network of fulfillment centers in the US and UK|
|Shipwire||Serious international shippers and high volume, large inventory sellers|
Finding a great 3PL company to handle your small business’s order fulfillment can be a game changer. Just imagine! The time and energy you currently spend stocking products, packing boxes, and shipping orders can be redirected to marketing and other areas that drive growth. The key is knowing how to find the best order fulfillment partner for you.
If your business has a low SKU count and quick product turnover, or if you’re looking for someone to handle batch fulfillment from a successful crowdfunding campaign, ShipBob is a great option. Or, if your products are heavy or require kitting or customization, working with Red Stag will be a better choice. And if your business sells primarily on Amazon, Fulfillment by Amazon is a no-brainer.
If you’re not sure what you need or are looking for a tailored-made solution, the experts at our recommended 3PL matchmaking service, FulfillmentCompanies.net, will make sure you find the perfect partner.