If you're connected with the realm of retail sales in any capacity - ecommerce, in particular - you'll understand the importance of order fulfilment. This essential process lies at the heart of the supply chain, encapsulating the journey the product takes from the on-screen shopping basket to the customer's doorstep.
Getting this process right has never been more crucial than it is today; consumers have very high expectations these days, not only regarding the products themselves, but also when it comes to delivery speed, packaging and returns. A business that fails in any of these areas runs the risk of losing customers, which can be disastrous.
So, how do you ensure that you keep on top of online orders accurately, on time and without a lot of expense?
Thousands of UK businesses have benefited from entrusting this process to a fulfilment provider, so could that be the solution you need?
The only way to answer this is by exploring the subject in depth to discover more about order fulfilment costs. And, as a trusted name UK order fulfilment company, Direct Fulfilment 365 is happy to furnish you with all the relevant information.
We'll break down the pricing structure to see what fulfilment providers charge on average, allowing you to make sensible, informed business decisions to maximise your opportunities and increase your chances of success in a tough and competitive market!
In the UK, around 70% of online sellers and ecommerce businesses have outsourced their fulfilment operations to a third-party logistics company, like Direct Fulfilment 365. Furthermore, around 86% of all packages delivered in the UK are handled by a third-party logistics (3PL) provider.
So, what's all the fuss about? Why are so many businesses outsourcing fulfilment to a 3PL?
Before we investigate the costs, we'll reveal the reasons behind this by outlining the potential benefits of using order fulfilment services:
Outsourcing your fulfilment operations to a 3PL eliminates the need to invest in storage space, staff and equipment. And as your business expands, the 3PL will scale its service to match the level of growth or any seasonal spikes, all without you having to hire extra staff or find adequate storage.
Instead of committing to fixed fees, you can take advantage of flexible rates that reflect the service received.
Most 3PLs have a network of fulfilment centres strategically situated close to major hubs, including road, rail and air travel. As part of your inventory will be stored with the company, the goods will be prepared and shipped more quickly, resulting in happy customers.
By outsourcing logistics, you can concentrate on growing your business, improving your products, and enhancing customer experience. Instead of managing the complexities of warehousing and shipping, you can focus on sales, marketing, and strategy.
Faster delivery times, accurate order processing, and professional packaging contribute to a positive customer experience. Many 3PLs also offer returns management, ensuring smooth handling of product returns, which further boosts customer loyalty.
3PL providers specialise in logistics and supply chain management. They have the experience, technology, and processes to handle inventory management, order processing, and shipping more efficiently than most in-house operations. Their expertise ensures that your orders are picked, packed, and shipped accurately and on time.
A 3PL provider helps mitigate the risks associated with potential disruptions in the supply network, offering a safety net that ensures your operations keep running smoothly. Thanks to their contingency plans and diversified relationships with multiple carriers, they can quickly adapt to unforeseen events such as carrier delays, strikes, or supply chain bottlenecks.
By having these backup strategies in place, a 3PL minimises the impact of unexpected challenges, ensuring that orders are still processed and delivered on time. This proactive approach not only protects your business from costly delays but also helps maintain customer satisfaction, even when the unexpected happens.
Check out our post “What is 3PL fulfilment and why do growing businesses need it”.
If you’re looking to expand internationally, partnering with a 3PL provider can make the process far smoother and more manageable. They have the expertise to facilitate cross-border shipping, ensuring that your products move seamlessly through international supply chains. From navigating complex customs regulations and managing necessary documentation to calculating duties and taxes, a 3PL takes the hassle out of international logistics. Their established relationships with global carriers also mean they can negotiate better rates and ensure timely deliveries, even across borders. This allows you to enter new markets confidently and efficiently, giving your business the opportunity to grow without the typical headaches associated with global expansion.
Many 3PLs offer a range of additional services such as kitting, custom packaging, and labelling, all of which can significantly enhance the customer experience and strengthen your brand identity. These value-added services allow you to go beyond standard fulfilment by creating a more memorable unboxing experience and ensuring that your products arrive in a way that reflects your brand’s quality and attention to detail:
These tailored services don’t just improve the customer journey - they also help your business stand out in a crowded market, leaving a lasting impression that can drive repeat purchases and brand advocacy.
3PL providers like Direct Fulfilment 365 specialise in logistics and supply chain management. They have the experience, technology, and processes to handle inventory management, order processing, and shipping more efficiently than most in-house operations. Their expertise ensures that your orders are picked, packed, and shipped accurately and on time!
Most 3PLs use sophisticated technology such as inventory management systems, order tracking, and data analytics. These systems provide real-time insights, allowing you to monitor stock levels, track shipments, and identify trends to optimise your supply network.
With automated processes and experienced staff, 3PLs significantly reduce the risk of order errors, which in turn minimises returns and improves customer retention.
So, there you have it: partnering with a 3PL, ecommerce businesses can enhance their operational efficiency, improve customer satisfaction, and position themselves for long-term growth. This explains why so many UK businesses have made the switch and outsourced their fulfilment process to a 3PL fulfilment centre.
Keeping these facts in mind, it's time to move on and explore the costs involved...
It's not always easy to pin down exact figures, as there are so many variables involved in calculating fulfilment costs, and all 3PLs have different pricing models. However, we can break this down into sections to provide a general picture of how much ecommerce fulfilment costs on average...
Some 3PLs charge setup fees to get everything up and running. These 'onboarding fees' go towards integrating your ecommerce platform with the 3PL's warehouse management system (WMS), setting up the inventory management system, importing product data and setting up SKUs. The system will also have to be configured for any customer requirements.
The actual fee will depend on the size and scale of the operation, with average costs between £200 and £1,000, although smaller businesses may benefit from lower fees or even have them waived entirely.
Storage fees are charged for receiving inventory and storing products at the 3PL’s warehouse or distribution centre, and the cost is usually determined by the amount of space the items occupy and the duration they remain stored. These fees can be structured in a couple of different ways, depending on how the 3PL calculates storage usage.
If you have a large inventory or stock that moves slowly, these costs can accumulate over time, eating into your profit margins. However, with effective inventory management practices - such as forecasting demand accurately, rotating stock efficiently, and avoiding overstocking - you can minimise excess storage time and keep these expenses under control. Additionally, periodic audits and real-time inventory tracking can help identify slow-moving items early, allowing you to take action before storage costs spiral.
Every time a customer places an order, the 3PL team swings into action to carefully pick and pack the items, ensuring accuracy and efficiency. These flat fees are usually charged per order and can vary depending on the number of items involved and any special handling or packaging requirements.
These small add-ons can quickly add value to the customer experience, making your brand stand out while ensuring the fulfilment process remains smooth and cost-effective.
Check this out "What is a pick and pack service".
Shipping is often the most variable and unpredictable part of the fulfilment process. 3PLs usually negotiate discounted rates with major carriers and courier services (such as Royal Mail, DPD, and Evri), allowing them to offer lower shipping costs than most individual businesses could secure on their own. However, delivery costs are calculated based on several factors:
To give you an idea of current shipping costs at the time of writing, here's a quick guide:
International shipping costs vary significantly depending on the destination, but generally range from £10 to £30 or more for standard delivery.
Many 3PLs allow you to pass on these discounted shipping rates to your customers, giving you a competitive edge by offering lower delivery costs or even free shipping without significantly impacting your margins.
Handling returns is an essential part of running a successful ecommerce business, and most 3PLs offer a returns management service designed to make this process as smooth and hassle-free as possible, both for you and your customers. An efficient returns process not only improves customer satisfaction but also helps protect your brand’s reputation.
When a product is returned, the 3PL assesses its condition and takes the appropriate action, whether that’s restocking, refurbishing, or disposing of the item. These services often come with associated fees, which may include:
A streamlined returns process not only enhances the post-purchase experience but can also encourage repeat business by giving customers confidence that any issues will be handled quickly and professionally. Plus, with real-time reporting and analytics from your 3PL, you’ll gain valuable insights into why items are being returned, helping you fine-tune your product offerings and reduce returns over time.
Check this out "How to reduce returns in ecommerce".
It's all very well listing all the separate fees for the different stages, but you need to know how this all equates to your fulfilment needs for your business. While the above breakdown is helpful to an extent, it might be better to present an average figure for fulfilment fees overall.
For small to medium-sized businesses in the UK, outsourcing fulfilment to a 3PL typically costs between £1.50 and £5 per order, depending on the complexity of the service. For certain types of orders (particularly large or bulky items), the cost can be around the £30 mark, but this is all relative to the amount of logistical effort required. High-volume businesses may benefit from discounts and see their per-order costs drop significantly.
By outsourcing to a 3PL, you’re not just paying for storage and shipping - you’re investing in expertise, efficiency, and scalability with a professional, reliable company. While there’s an upfront cost, the long-term savings in time, labour, and operational headaches often make it well worth it!
Charges applied by 3PLs are typically not structured as a simple monthly subscription fee. Instead, most 3PLs use a pay-as-you-go model, where you’re billed based on the specific services you use. However, some providers may offer hybrid models that include minimum monthly fees or retainers. Here’s how it usually works:
Most 3PLs charge based on the volume of orders and services provided rather than a fixed rate. So, the amount you pay depends on what you use, which makes this model ideal for businesses with fluctuating order volumes. Key charges include the main costs as described above, but here's a recap:
Some 3PLs require a minimum monthly spend to ensure their services remain profitable. If your order volume is low or seasonal, you may be required to meet a minimum threshold, typically between £200 and £500 per month.
A few 3PLs offer a subscription-style model where you pay a fixed monthly fee that covers a certain volume of orders and services. This approach is less common and usually applies to smaller businesses or startups that want predictable monthly costs.
In most cases, 3PL pricing is tailored to your business, allowing you to scale costs in line with growth while maintaining flexibility.
The honest answer is that it depends on your specific circumstances. However, for most online sellers and ecommerce businesses, getting a 3PL to fulfil orders for you is a wise move!
Let's look at some of the potential benefits again:
The key is to find a 3PL with a transparent pricing policy - you don't want to be hit with hidden fees further down the road! Always check the contract and make sure you are aware of everything you're being charged for.
Ultimately, it's up to you to decide on the best fulfilment strategy for your needs. In general, UK businesses save around 15% annually by switching to a third-party provider, but much depends on the 3PL and the daily average volume of orders.
If you're curious about the potential costs and savings your business could be benefiting from, why not get in touch with us? We’ll provide a free, bespoke quote that’s tailored specifically to your business needs, giving you a clear picture of how outsourcing fulfilment can boost your bottom line. Our team takes the time to understand your operations and goals, ensuring that our solution fits perfectly with your growth plans, and we’re confident you’ll be impressed by the value we can offer.
Ready to take the plunge? Partnering with Direct Fulfilment 365 could be the key to scaling your business smoothly, allowing you to meet increasing demand while delighting your customers with fast, hassle-free deliveries. Let us handle the complexities of fulfilment so you can focus on growing your business and building lasting customer relationships.
At Direct Fulfilment 365, we take the stress out of logistics so you can focus on growing your business. From same-day dispatch to 24/7 inventory tracking, we’re here to make your operations seamless.
At Direct Fulfilment 365, we are dedicated to helping your business thrive by providing seamless logistics and fulfilment solutions. Whether you're looking to enhance your shipping options or streamline your operations, we are here to support your growth.
of consumers expect BOPIS (Buy Online, Pick Up In-Store) as a shopping option.
of consumers search for faster shipping options.
Request a Quote
Fill out the form to get started with our expert fulfilment services.
