Glossary
Someone else's warehouse.
A 3PL stores your inventory, then picks, packs and ships each order as it comes in — you sell, they fulfil. You pay per order, plus storage.
3PL cost = pick & pack per order + storage
orders per month 800
at 800 orders a month, self-fulfilment runs $3,500 against $3,600 at the 3PL — in-house is cheaper by $100.
What you're really buying
The per-order math understates the trade. What a 3PL really sells is founder time: the hours spent printing labels, taping boxes and driving to the carrier depot come back the day your first pallet lands at their dock. A good 3PL also spreads your stock across warehouses you could never rent alone, which is how a small store offers two-day shipping to most of the country. The costs that surprise people are the quiet ones: storage fees that keep accruing on slow SKUs long after the pick-and-pack fees stop, returns handling — every RTO is touched twice and shipped twice — and receiving fees whenever a container arrives. All of it lands on your per-unit COGS, so reprice with the full fee schedule in hand, not the headline pick fee.
When to switch
Ignore the crossover in the figure if fulfilment is eating your week — buying those hours back below break-even volume is a defensible trade, because that time goes into the work that grows the store. The genuinely hidden cost is onboarding: integrating your store, relabelling inventory and freighting your stock to their warehouse takes weeks, and orders still have to go out while it happens. So switch when things are calm, never in the fourth quarter. A reasonable rule: once packing takes more than two working days a week, start the search — vetting a 3PL takes a month or two on its own, and the good ones make you queue.
Made with care by Astral Commerce