Since 2017, we’ve conducted one of the longest-standing warehouse pricing surveys in the industry, gathering data from over 600 warehouses each year. The survey includes 63 questions focused on warehousing costs, pricing, and performance metrics. This data gives you a clear understanding of fulfillment costs, helping your business stay competitive and helping you secure the best rates.
What You Pay for Fulfillment Service
| Service | Service Definition | Service Costs |
|---|---|---|
| Set Up Fees | Charges for onboarding and system integration. | Per Account: $425 (Range: $0 to thousands) |
| Receiving Fees | Fees for processing and handling inbound inventory. | Per Hour / Per Container: $45.67/hour (Range: $425-$500) |
| Storage & Warehouse Fees | Costs for storing goods in the warehouse. | Per Pallet: $20.17 per pallet (Alternate methods: $0.4625/cubic ft, $3.08 per bin) |
| Amazon Fees | Fees for labeling, preparing, and storing products to meet Amazon's FBA requirements. | Per Unit / Per Label: $0.37 per label (Range: N/A) |
| Fulfillment Fees (Pick and Pack) | Charges for picking items from inventory and packaging them for shipping. Either structured as a per order fee or a per order fee plus a per item fee. | Per Order: $3.25 per single item order (Range: $2.50-$4.79) |
| Inbound Shipping Fees | Cost of sending products from suppliers to the fulfillment center. | Per Shipment: Discounted off carrier rates (Varies by carrier) |
| Outbound Shipping Fees | Cost to send products from the warehouse to customers. | Per Shipment: Markup over cost (Range: 14.60%-16.20% markup; 30-55% discount off rates) |
| Box Fees | Charges for packaging materials used to prepare orders. | Per Box: $1.19 per box (Range: $0.50-$1.50) |
| Order Inserts | Fees for adding promotional inserts or special labeling to orders. | Per Insert / Per Label: $0.17 per insert (Range: $0.05 per label) |
| Return Fees | Costs for handling returned items, including inspection and restocking. | Per Return: $4.06 per return (Range: $3.50 + $0.56 per item) |
| Kitting Fees (I.e. Subscription Boxes) | Fees for assembling multiple products into a single package. | Per Hour / Per Unit: $43.30/hour (Range: $0.25-$0.65 per unit) |
| Account Management Fees | Charges for ongoing account management and customer service support. | Per Month: $102.88 (Range: $30-$500) |
| Call Center Services Fees | Costs for providing inbound customer service via the 3PL's call center. | Per Minute: $1.29 per minute (Range: N/A) |
What You Pay When Applying Volume Discounts
Fulfillment providers offer discounts based on the volume of orders, storage, and shipping. Here’s how discounts typically break down:
| Service | % of Providers Offering Discounts | Volume Break | Average Discount |
|---|---|---|---|
| Pick and Pack Fees | 69% | 500-1,000+ orders/month | 6.00% |
| Pallet Storage Fees | 42% | 500-1,000+ pallets/month | 5-10% |
| Ground Shipping | 80% | Varies | 15-30% |
| Express Shipping | 80% | Varies | 40-50% |
| LTL Shipping | 80% | Varies | 20-50%+ |
Many providers offer contract incentives for locking in longer terms, such as yearly or multi-year agreements. This is beneficial for businesses as 77% of fulfillment companies reportedly increase prices annually, with average increases ranging from 3-7%.
Most Common 3PL Costs: What You’ll Pay Most Often
When partnering with a fulfillment provider, many warehouses and fulfillment centers use activity-based pricing. This means warehouse operators or fulfillment providers charge businesses for each specific service or “activity” they perform on behalf of the business. Typically, the fulfillment provider will total up the activities they’ve completed for your business over the course of the month and issue a monthly invoice, though some may bill more frequently, like bi-monthly.
If you’re a business looking for fulfillment services, here are the main fees you’ll likely encounter when working with a fulfillment provider:
- Initial Set-Up Fees
- Receiving Fees
- Amazon FBA Fees
- Storage & Warehouse Fees
- Fulfillment or “Pick and Pack” Fees
- Inbound Shipping Fees
- Outbound Shipping Fees
1. Initial Set-Up Fees
The cost of integrating with a fulfillment provider varies depending on the complexity of the setup. Basic integrations like web store connections or EDI setups typically range from $150 to $1,500, with more complex systems costing even more. Be aware that some fulfillment providers may also charge recurring monthly fees for system maintenance, ranging from $10 to $500.
- Range: $150 – $1,500 (higher for complex integrations)
- Average: $425
- Recurring Fees: Monthly maintenance costs range from $10 to $500 (average: $103)
2. Receiving Fees
Receiving is one of the first line items where costs may add up. This includes the time spent counting, inspecting, and labeling goods as well as storing them in the fulfillment provider’s facility. Handling discrepancies, like damaged or incorrect shipments, can also lead to additional charges, so knowing how these are addressed can help avoid future costs. Access to real-time inventory updates is helpful but often comes at a premium.
| Cost Type | Cost Range |
|---|---|
| Hourly Rate | $40 - $46 per hour (avg: $45.67) |
| Per Pallet | $4 - $15 per pallet (avg: $10.52) |
| Per Item | $0.20 - $0.45 per item |
| Per Order | $30 - $50 per order |
| Per SKU | $2.50 - $3.50 per SKU |
| Per Box | $2.00 - $3.00 per box |
| Per Container (20-foot) | $350 per container |
| Per Container (40-foot) | $500 per container |
3. Storage & Warehouse Fees
Storage fees can quickly inflate your costs, especially depending on how the fulfillment provider charges—by pallet, square footage, or cubic footage. Knowing how inventory is counted (daily, weekly, or monthly) also plays a role in managing costs, as inaccurate counts can lead to higher charges. Understanding this structure will help control unnecessary fees.
- Pallet Storage: $8 – $40 per pallet per month (average: $20.17)
- Cubic Foot Storage: $0.45 – $0.55 per cubic foot
- Bin Storage: $3.08 per bin per month (average)
- Specialized Storage: Climate-controlled storage adds a 40–75% premium, typically $25 – $35 per pallet per month
4. Amazon FBA Fees
Amazon FBA fees often surprise businesses, with costs piling up for required services like labeling, SKU preparation, and storage.
- Amazon Labeling Fee: $0.37 per label
- SKU Preparation: $0.20 per SKU
- Order Preparation: $2.50 – $3.20 per order
5. Fulfillment or “Pick and Pack” Fees
Fulfillment fees can vary widely and may hide additional costs if you don’t get a clear breakdown upfront.
- Average Single Item Order Fee: $3.25 for B2C orders, $4.85 for B2B orders
- Additional Per Item Fee: $0.50 per item
- Packaging Fees: Often marked up by 10–20% on box costs (average: $1.19 per box)
- Order Insert Fee: $0.15 – $0.40 per order (average: $0.17)
6. Inbound Shipping Fees
Inbound shipping fees cover the cost of getting products from your supplier to the fulfillment provider’s warehouse.
- Rate Models: Discounted rates may be available through the fulfillment provider’s carrier relationships
- International Shipments: May include freight forwarding services, customs clearance, and drayage
- Domestic Shipments: Small parcel, LTL, or FTL
7. Outbound Shipping Fees
Outbound shipping fees cover the cost of sending products to your customers.
- Discount Models: 24.53% of fulfillment providers offer a discount off published rates
- Cost-Plus Pricing: 62.26% use a markup over cost
- Volume Discounts: LTL and truckload shipments can receive discounts of up to 45–60%
- Additional Fees: Some fulfillment providers charge $1.00 to $3.00 per order if you use your own shipping account
Less Common 3PL Costs: What You’ll Pay
Working with a fulfillment provider can also involve occasional fees that aren’t part of your regular expenses.
- Box Fees: $0.25 – $2.50+ per box
- Order Insert Fees: $0.17 per insert
- Label Fees: $0.05 per label
- Shrink Wrapping Fees: $36 per hour or $5.50 per pallet
- Return Fees: $4.06 per item
- Kitting Fees: $39 per hour
- Account Management Fees: $30 – $1,000+ per month
- Call Center Services Fees: $1.29 per minute
Frequently asked questions
What should I watch for in fulfillment pricing schemes?
Be aware of hidden fees, bait-and-switch tactics, or inflated shipping costs.
What is the average fulfillment cost as a percentage of gross product sales?
The most efficient companies operate at 8–10% of gross sales, with averages around 10–15%.
How do I compare different fulfillment companies’ pricing?
Request a mock invoice with specific assumptions from each fulfillment provider.
How can outsourcing fulfillment save my business money?
Outsourcing reduces costs like rent, labor, and shipping through volume discounts and shared space.
How do I compare in-house fulfillment costs versus outsourcing?
Compare all in-house costs including labor, rent, utilities, insurance, supplies, shipping, and management time to achieve a fair comparison.
