Choose Between a 3PL Warehouse or In-House Fulfillment

Meta: Need a 3PL provider? Explore the pros and cons of in-house fulfillment and 3PL warehouses to determine which option is best for your eCommerce logistics. 

After a few years of running an eCommerce business, you’re faced with a good problem…

You’ve done everything correctly, and your online business is growing. Business goals are being surpassed, especially as the global ecommerce market is forecasted to reach a value of $58.74 trillion by 2028. 

It’s all good, except you’re bending over backwards just to meet the demand. 

Should you find a 3PL or third-party logistics provider to handle order fulfillment? Today, we’re going to help you know when to outsource your logistics. 

Generally, there are two options. First, you can use in-house fulfillment; the second option is working with 3PL companies. You need to know which route is best for your eCommerce company so your operations support and grow alongside your sales. 

What is In-house Fulfillment? 

In-house fulfillment, or a private warehouse, is when your business is responsible for handling the entire order fulfillment process. This involves hiring the necessary staff, managing inventory, and shipping customer orders from your own warehouse. 

Pros of Inhouse Fulfillment

Cons of Inhouse Fulfillment

Most small businesses start with in-house fulfillment before transitioning to a 3PL warehouse. Then, their operational needs become too much for them to handle internally. And they have to make a decision.

For example, housing inventory yourself isn’t a problem if you ship less than 500 orders monthly. But if you’re getting 5,000 orders every month, inventory management inevitably becomes a major responsibility. Along with that comes a lot of expensive infrastructure to meet your new operational needs. 

What is a 3PL Warehouse? 

A 3PL warehouse is a physical location where a fulfillment company handles the supply chain and logistics operations of other companies. Supply chain management can get complex. So, choosing a 3PL company to do it simplifies everything—especially when you’re competing against eCommerce businesses with omnichannel fulfillment networks. 

Pros of 3PL Warehouse

Cons of 3PL Warehouse

Using a 3PL warehouse is an expenditure, but it’s one that makes sense for growing businesses looking to reallocate resources. If you work with a quality 3PL provider that delivers on its promises, using 3PL warehouses frees you from burdensome responsibilities. 

Find the Perfect Logistics Fit 

Whether you opt for in-house fulfillment or choose to partner with a 3PL provider, remember that both options have their advantages and drawbacks. Making an informed decision will help ensure that your eCommerce logistics align with your business growth. Then, you’ll have a solid foundation for success in your emerging eCommerce business.

Looking for a reliable 3PL company to work with? 

At San Legend, we help eCommerce businesses scale their brands and break into new markets by providing customized, agile, and forward-thinking third-party logistics solutions. Reach out today to see how we can help.