Every fulfillment operation has the same core cost components, regardless of provider. Here's what they are:
Here's where it gets interesting. Beyond the standard cost components, watch for these charges:
The only metric that matters for your P&L is your total fulfillment cost per order. Here's the formula:
Calculate this monthly for at least 3 months to get an accurate picture that accounts for variability. Then compare it against your average order value (AOV) to understand what percentage of each sale goes to fulfillment.
For most ecommerce brands, fulfillment costs represent 15-25% of the product's retail price. If you're significantly above that range, there's likely room for optimization — either through better carrier rates, more efficient storage, or a different fulfillment partner.
Before signing with any fulfillment provider, ask these questions:
Is there a minimum monthly order or spend requirement? What happens if I don't meet it? Are there peak season surcharges? What months do they apply and what's the percentage? What's included in the pick and pack fee? Materials? Is the receiving fee per pallet, per unit, or per hour? When does long-term storage kick in? 90 days? 180 days? What's the additional charge? Are there any account management, integration, or onboarding fees? Can you provide a sample invoice so I can see how billing works? What happens to my rate if my volume doubles? Triples?
A transparent partner will answer these questions clearly and provide documentation. If the answers are vague or they redirect you to "let's discuss that later," proceed with caution.
At Palletized, we believe pricing should be as straightforward as our service. We provide detailed, customized quotes based on your actual order data — not generic rate cards that hide the real cost.
No peak season surcharges. No hidden account management fees. No surprises on your invoice. We walk through every cost component with you during onboarding so you know exactly what you're paying for before we receive your first pallet.
Our pricing scales with your volume — as your business grows, your per-order costs improve. Because your success is our success, and aligning our economics with yours is how we build partnerships that last.
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