What is a Fulfillment Center?
Fulfillment centers are places in which orders are received, products are packaged, and finally shipped out to the customers that placed the original order.
How Do Fulfillment Centers Work?
E-commerce merchants deliver their finished products to fulfillment centers so that the staff on hand at those centers can package products faster and deliver them to their customers’ fasters. Because fulfillment centers are often located closer to major metropolitan areas, it cuts down on the distance carriers have to travel to deliver orders to customers. Unlike warehouses where large amounts of finished goods are stored on a long-term basis, products are stored at fulfillment centers for only a short period of time. Also, unlike warehouses, products shipped from a fulfillment center are sent to individual customers and not sent out in bulk or as cargo.
Benefits of using a Fulfillment Center
By using a fulfillment center, e-commerce merchants can grow their business at scale. These locations, which are often run by Third-Party Logistics Companies (3PLs), can help manage your inventory levels, package products faster and more efficiently, and also potentially negotiate lower shipping rates. They can also implement value-added services like branded packaging, adding thank you cards in orders, and other additional services.