When we think of a large brand, it’s easy to assume they’ve got everything figured out, including their fulfillment operations. After all, they’re an enterprise, so they should be running their own warehouses, right? But that’s not always the case, and honestly, it’s not always the smartest move either.

Even big brands must make strategic decisions about getting products into customers’ hands. And with 85% of shoppers stating they won’t return after a poor delivery experience, finding the most efficient and reliable fulfillment setup is crucial.

In this article, we’ll discuss what enterprise brands should consider when deciding between in-house fulfillment and partnering with a 3PL. We’ll examine the real costs, the workload involved, and what makes each option better.

What It Takes to Run Fulfillment In-House

A lot goes on behind the scenes when you’re running a large brand, and fulfillment is a whole challenge on its own. Indeed, handling things in-house provides more control over how they are managed, but that control comes with a lengthy list of responsibilities, like:

Facility costs

One of the first things you’ll need if you’re running fulfillment in-house is enough space. That means finding a warehouse that’s big enough and in a good location. You’ll need somewhere that makes it easy to store, pack, and ship your products efficiently.

The upside? It’s your own space, so you have complete control over how everything’s run. But that control comes with a hefty price tag. As soon as you commit to a facility, your overhead increases. You’ll need to cover:

• Lease or purchase costs for the warehouse itself
• Utilities and maintenance, like electricity, water, cleaning, security, and general upkeep
• Insurance for the property, your inventory, the equipment inside, and even your staff

It’s a lot to manage, and it’s only the beginning.

Labor and staffing

When you’re handling fulfillment, you’ll need people to keep things moving—literally. This requires a whole team to manage the day-to-day work, including:

• Pickers and packers to handle orders
• Warehouse associates to receive and organize inventory
• Supervisors or managers to oversee operations
• Shipping and receiving staff to manage carrier pickups and deliveries
• Inventory specialists to track stock levels and reduce errors

That means going through the hiring process for each of these roles. And here’s the thing: on average, it takes around 50 days to fill an open position. That’s almost two months just to bring someone in. And we all know, time is money, especially in business.

Even once you’ve found the right person, it still takes time to train them and get them up to speed. All of that adds up, and it can slow you down if you’re trying to scale quickly or keep up with demand.

Technology and equipment

You’ll also need to consider your tech stack, which includes warehouse management software, barcode scanners, and automated systems. These tools help your warehouse run smoothly and reduce the manual work needed to keep things moving.

While this tech can make your operations more efficient, there’s no getting around the upfront investment. You’ll have to cover the cost of the equipment itself, plus setup, licensing, and ongoing maintenance. 

If anything breaks, it’s on you to fix it. Necessary updates, additional features, or tool integrations are also extra expenses to plan for.

Packaging and supplies

Did you know 85 million packages arrived damaged last year? That’s a lot of disappointed customers. While couriers handle shipping, your brand still plays a significant role in ensuring products are packed well enough to survive the journey. 

That means thinking about everything from approved boxes and fillers to tape, labels, and all the packing materials in between. And like most things, buying these one by one can get expensive fast. Buying in bulk can help save money, but you’ll also need storage space and a sufficient budget to cover the upfront cost.

It really becomes a balancing act. You must consider what makes sense for your business, including what helps protect your products, keeps costs manageable, and fits within your space and budget.

Shipping contracts and carrier rates

Shipping is a huge part of fulfillment, and it doesn’t come cheap. Building strong relationships with carriers can work in your favor if you’re an enterprise brand, especially one serving multiple countries. You can negotiate better rates, which not only helps your bottom line but also makes shipping more affordable for your customers.

Think about it: long-distance deliveries rack up serious costs. And if you’re trying to handle everything yourself, that could mean setting up additional warehouses in other regions you serve. That brings you right back to dealing with more facility expenses, staffing, tech, and everything else that comes with running fulfillment in-house. 

It’s a big commitment, and something that needs careful planning to avoid unnecessary strain on your operations.

The 3PL Advantage for Enterprise Brands

For enterprise brands, third-party logistics (3PL) providers can offer serious relief by handling the complex (and expensive) parts of fulfillment. Here’s what makes 3PL a smart move:

No need to invest in your own facility

We’ve touched on this earlier, but it’s worth emphasizing again: having your warehouse comes with a long list of expenses. 

When you work with a 3PL, a lot of those worries disappear. You don’t have to hunt for a warehouse that fits your size and location needs. You don’t have to sign a long-term lease or deal with property upkeep. Instead, you can partner with a 3PL provider that already has the space, setup, and infrastructure to support your business.

At the end of the day, that’s money saved, time freed up, and one less thing for your team to stress about.

No warehouse staff to manage

Compared to in-house fulfillment, 3PLs already have experienced teams who know the ins and outs of warehouse operations. These are people who do this every day. They’re trained, equipped, and ready to handle everything from receiving inventory to picking, packing, and shipping orders.

The best part? You don’t have to manage them. Your 3PL partner takes care of their staff, which means no hiring, training, or worrying about day-to-day operations. You get to step back and focus on growing your business, knowing that the fulfillment side is running smoothly behind the scenes.

Built-in access to advanced tech and automation

As modern fulfillment runs on tech, building it from scratch can be expensive and time-consuming. However, with a 3PL partner, you can make this one of your least worries.

Since 3PLs need to stay competitive, they’re continually investing in the latest tools and systems to deliver smooth, efficient fulfillment. That means they’re already on top of updates, automation, and new technology that can keep your operations running at their best.

The good thing is you can access these advanced systems without building or managing anything yourself!

Shared packaging and fulfillment resources

One of the best aspects of working with 3PLs is their ability to share resources across the businesses they support. Because they buy packaging materials and supplies in large volumes for all their clients, they get better prices, and you benefit from those savings.

So even if you’re sending out branded, neatly packed orders, you’re doing it at a much lower cost, with less waste and way less effort.

Better shipping rates and faster delivery from multiple nodes

3PLs handle vast volumes of shipments, which gives them the power to get better shipping deals. That’s something most brands can’t do on their own.

More importantly, since many 3PLs have fulfillment centers in multiple locations, your orders can be sent from the site closest to your customer, making shipping faster and cheaper for everyone.

Simplified reverse logistics

Returns and exchanges can be a pain to manage. After all, it involves:

• Handling of returned products
• Processing refunds, exchanges, and repairs
• Inspecting returned items
• Managing restocking inventory
• Providing a hassle-free return experience for customers
• Reducing the time and costs involved in handling returns

When you outsource reverse logistics, you can save valuable time and reduce costs that would otherwise pile up if you managed returns in-house. This lets you focus on growing your business while your 3PL partner handles the returns behind the scenes.

In-House vs. 3PL: How to Decide What’s Best for Your Brand

There is no simple answer to deciding whether to handle fulfillment in-house or outsource it to experts. The right choice depends on your current business goals and strategy.

In-house fulfillment might work if:

• You already own or efficiently run a fulfillment center. If you have a functional warehouse, sticking with in-house can keep things simple.
• You ship at massive volume and can negotiate rates. Large shipping volumes often mean you can secure better deals with carriers, making owning a fulfillment center more cost-effective.
• You want full control over the customer experience. Managing fulfillment yourself means you oversee every step and can tailor every detail exactly to your needs.
• You need extreme customization or special product handling. Some products require particular care or packaging that’s easier to manage in-house.
• You have the capital and team to do it right. Running a top-notch fulfillment operation isn’t cheap or easy. If you have the proper budget and experts on your side, in-house can be a solid option.

Working with a 3PL might be better if:

• You’re scaling fast and can’t keep up. Sometimes your business grows so fast that your fulfillment can’t keep up. Partnering with a 3PL means you can handle that extra demand without skipping a beat.
• You’re wasting time managing fulfillment. Instead, focus on scaling your business and offload fulfillment responsibilities to trusted experts.
• Your costs are out of control. Sometimes, the expenses of in-house fulfillment pile up, and partnering with a 3PL can help you cut those costs.
• You need to ship faster, from more locations. 3PLs have multiple warehouses across regions, allowing them to deliver your products to customers more quickly and affordably.
• You want the best tech. Instead of investing heavily in complex systems yourself, you get access to advanced warehouse management and automation through your 3PL.
• You want easier returns and a better customer experience. A 3PL’s reverse logistics expertise can make returns and exchanges smooth and hassle-free.
• You want to reduce risk during peak seasons. A 3PL can flex up capacity and help you avoid the pitfalls of being understaffed or overwhelmed.

Set Your Brand Up for Growth with a Smarter Fulfillment Strategy

Running fulfillment in-house has its challenges, but it also means having complete control over how things get done. 

For some brands, that control is worth the extra effort. On the other hand, working with a 3PL partner allows you to avoid hefty upfront investments, provides access to cutting-edge technology, and significantly reduces the daily workload. All in all, you have to weigh in your options and see which would work best for your brand.

At MyFBAPrep, we’ve helped enterprise brands navigate these challenges. Our team knows how to tailor fulfillment strategies, helping businesses save money, boost efficiency, and keep customers happy. Contact us to discover how you can start scaling smarter with an efficient fulfillment strategy!