When it comes to fulfillment… control inventory to control costs!

Regardless of a fulfillment center’s methodology, you are paying for two things – space and activity. Each 3 PL or order fulfillment operation has its own methodology and payment schedule. Some fulfillment warehouses charge fees to store your books and fees to pick-and-pack and ship the books from the warehouse. Others will charge based upon percentage of sales. One of the best ways to control cost is by controlling your inventory. Whatever the fee structure, you must clearly understand the rates, terms and conditions of the contract.

Looking at pricing proposals from different warehousing and fulfillment vendors can be difficult because each one uses a different methodology for computing their rates. For this reason, reviewing the pricing proposals of warehousing and fulfillment companies should be done with great care and diligence. Here are tips to help avoid some of the challenges of warehousing and fulfillment pricing:

• Make sure the warehousing and fulfillment vendor has listed ALL costs
• Beware of monthly minimum charges
• Determine all monthly fixed recurring charges
• Ask if the vendor makes margin on freight charges and UPS discounts
• Double check move-out charges – some warehouse operations add huge penalties for move-out fees
• Ask for referrals from current customers to ensure that costs don’t change after signup
• Check the vendor’s BBB rating
• Make sure that everything is documented in a contract

Want to know additional important considerations when choosing an order fulfillment service? They are now available in a Whitepaper on our website. If you have additional questions, or are interested in receiving this white paper by email, please feel free to contact me directly. I can be reached at (708) 587-4116 or kshay@ware-pak.com