WHAT IS A FULFILMENT CENTER?
In these times of booming e-commerce and growing demands for faster deliveries, everybody seems to be talking about fulfillment centers. But what is a fulfillment center, really? Is it just a fancy word for a warehouse – or something completely different? Let’s sort it out, shall we?
Yes, on the surface a fulfillment center is “just a warehouse”. It is a physical space where products are received, stored, picked, packed, and shipped. The difference is in the way it is managed. A fulfillment center is generally run by a provider of third-party logistics (3PL) offering their services and space to companies who want help with their last-mile logistics
What does a fulfillment center?The operations in a fulfillment center is centered around the so called order fulfillment process, to retailers or directly to the consumer. The steps can be described as:
- The seller places their inventory in the fulfillment center
- A customer completes a purchase online
- Order information is transferred to the fulfillment center
- The inventory is picked and the order is packed
- The order is labeled and shipped
What are the benefits of using a fulfillment center?
Using an external fulfillment center as a part of your logistics process has several advantages, especially for smaller e-commerce companies. Here are some of them:
- Avoiding time-consuming picking and packing
- More time to focus on marketing and business strategy
- Makes your business easy to scale
- No contracts for warehouse space and employees
- Utilizing the knowledge of logistics experts
- No investments in warehouse tech or automation