Many ecommerce businesses—from small startups to large global enterprises—rely on providers to manage their order fulfillment operations.
3PLs offer outsourced order fulfillment services and handle everything from order picking, packing, and transportation to last-mile delivery. As expectations for fast, seamless delivery rise quickly, 3PLs can help businesses meet customers where they are.
Outsourcing your order fulfillment services has many benefits, like improved on-time delivery performance and customer satisfaction—but these benefits come with additional costs. And if your business doesn’t monitor your 3PL costs closely, they can add up quickly and eat away at your bottom line.
Projecting the costs of a 3PL can come as a challenge to many ecommerce businesses. While 3PL pricing may appear simple, understanding the true costs of outsourcing your order fulfillment—when you factor in the many unknowns that come with the order fulfillment process—can be an opaque and difficult process.
In this blog, we’ll explore the most common 3PL pricing structures and explain how you can estimate the true cost of 3PL order fulfillment for your ecommerce business.
Understanding 3PL pricing
To accurately assess how much you are paying for your order fulfillment services, you must first develop an understanding of how your 3PL structures its pricing. There are two types of 3PL pricing models for order fulfillment:
Per-service 3PL pricing model:
This is the traditional (and most common) method that third-party logistics services use to calculate the order fulfillment price: 3PL providers charge for separate services, including picking, packing, and shipping.
Most 3PLs charge a flat fee for picking each item in an order from storage in the warehouse and then packing that item for shipment. These picking and packing fees will often vary, depending on the number of units in a given order, the size and weight of the products, the type of packaging required, and other factors.
On top of fees for picking and packing, logistics management services using this per-service pricing model will usually charge:
- A fee for shipping, which varies depending on:
- The shipping speed of the order, with faster delivery speeds almost always translating into higher shipping costs.
- The size and weight of the products being shipped: typically, the heavier the weight and the bigger the size of the shipment, the higher the price.
- The distance of the delivery: many 3PLs utilize zonal-based pricing and charge based on the distance a shipment needs to travel to reach its destination. Usually, the longer the distance, the higher the price.
- A number of surcharges, including fuel, residential, international, remote area, hazardous goods, oversize item, and even software licensing fee surcharges.
- Fees for other services, including storing inventory, kitting, providing customer support, and handling returns from customers.
Per-unit pricing 3PL pricing model:
A growing number of third-party logistics services, like Amazon Multichannel Fulfillment (MCF), have started using a unit-based pricing model. Unit-based pricing is simple: you only have to pay one bundled fee (inclusive of pick, pack, and ship) per unit. However, this all-in fee may vary depending on various factors.
With MCF, for example, the per-unit fulfillment fee will fluctuate depending on:
- The shipping speed—Standard (three days) and Expedited (two days)—with faster delivery speeds usually equating to higher shipping costs.
- The items’ dimensions. MCF uses “product size tiers,” or measurement categories based on the unit weight, product dimensions, and dimensional weight of a packaged item, to help determine the cost of fulfilling each one.
MCF is part of the fulfillment arm of Amazon Supply Chain Services (ASCS), Amazon’s broader end-to-end logistics network, which is designed to help businesses deliver quickly and reliably to shoppers across the globe. Unlike most other 3PLs, MCF does not charge based on the distance of the delivery. This is because with access to Amazon’s network, which stretches across 27 countries and has hundreds of facilities, products can be strategically distributed as close as possible to customers. This minimizes the distance and time it takes to deliver your orders.
Typically, logistics management services that use per-unit pricing for order fulfillment do not levy as many surcharges as 3PLs that use the traditional, service-based pricing model. (MCF, for example, only has a few surcharges for things like shipping to certain locations and shipping during the end-of-the-year peak holiday shopping periods.) Many ecommerce companies prefer this per-unit pricing system for 3PL order fulfillment, as this simple, all-in, bundled fee approach can make it easier for businesses to assess the average fulfillment cost per order.
Whether the order fulfillment services you are using (or are considering using) employ a service-based, unit-based, or other pricing system, make sure to study their rate card carefully, so you understand all the charges and surcharges that your business will have to bear for order fulfillment and other services.
Understanding your third-party logistics services shipment mix
In addition to getting a firm grasp of your logistics management service’s pricing structure, you should also develop a holistic understanding of your company’s shipment mix. In practice, that involves digging into your historical order data as well as existing demand forecasts to generate insights on these key questions:
What do you ship?
- Which products are you shipping?
- What are the characteristics (size, weight, etc.) of these products?
- Are you shipping any products that are oversized or contain hazardous goods?
- In what volumes and combinations are you shipping these products?
- At what times of the year are you shipping these products?
Where do you ship to?
- Which locations (countries, regions, states, cities, etc.) are you shipping to?
- Are you planning to expand to any other regions?
- It’s essential that you carefully evaluate your customer network—and regions targeted for expansion in the near future—so you can engage a 3PL with a footprint in those locations. MCF is a great option if you’re looking to scale into new regions quickly thanks to an expansive physical footprint.
How do you ship?
- What speeds (such as one-day, two-day, or three-day shipping) are you using?
- What modes of transport (air, road, rail, marine, intermodal, etc.) do you use?
- Do you anticipate you’ll need additional modes of transportation in the near future?
- With MCF as your 3PL, you’ll have access to Amazon’s complete suite of supply chain services, including ground freight and air cargo transportation. You can easily add on services as and when needed.
Work with your in-house team or a 3PL partner to analyze your data and develop a complete picture of your shipment mix. A logistics management service with access to the latest stock management and demand-forecasting software, like ASCS, will be able to provide you with a clear picture of your shipment mix, both now and into the future.
Understanding how a 3PL pricing system is applied to your business
Once you have a solid understanding of your 3PL’s pricing system and your company’s shipment mix, you can begin to assess the true cost of your 3PL provider’s order fulfillment services. You’ll need to understand:
- How does your 3PL charge your business for order fulfillment? What does it charge for each unit shipped or for various services such as picking, packing, and shipping?
- Which surcharges are being imposed on your orders? For example, you may be shipping to certain remote locations, sending items that contain hazardous materials such as lithium batteries, or shipping oversized items—and your 3PL may be tacking on a hefty surcharge due to these or other factors.
- Which charges, surcharges, and other fees are the main drivers of higher fulfillment costs for your business, given your shipment mix?
Creating a business-specific fulfillment cost calculator isn’t easy, but it’s worth the effort. Once you understand your average fulfillment cost per order, you can determine if your 3PL provider—given their pricing system, service offering, and past performance—is able to offer your business the best services at the lowest possible cost, or if it’s time to switch providers.
Decoding 3PL pricing
Whether you are evaluating your current 3PL provider or looking for a new logistics management service, you should understand how your partner’s rates translate into order fulfillment costs.
By following the steps outlined in this blog, you can assess the true costs of 3PL order fulfillment and figure out how much you should budget for order fulfillment services, how much to charge customers for shipping and delivery, and which third-party logistics service is the best match for your business.
Finding the right 3PL partner that can help you maximize on-time delivery performance for customers while minimizing your average fulfillment cost per order is critical to the long-term success of your ecommerce business.
Polaris Market Research: Third Party Logistics (3PL) Market Size, Share, Industry Analysis Report By Service (Dedicated Contract Carriage, Domestic Transportation Management), By Mode of Transport, By End Use, By Region – Market Forecast, 2026–2034
