Have you ever wondered what the 3PL pricing structure is like? Well, it is not an easy task to understand 3PL pricing as many 3PL companies are not transparent in their pricing structures.
This article will give you an overview of the components of 3PL Pricing and will give you additional information regarding why Red Stag Fulfillment stands out among 3PL providers.
As its name suggests, a 3PL (third-party logistics) is a partner that assists you with your logistics operations. 3PL service providers take control of warehousing to order fulfillment and shipping allowing the business owners to fully concentrate on the growth and empowerment of their businesses. ShipBob, Red Stag Fulfillment, ShipMonk, Shipfusion, etc are some of the well-known 3PL providers.
To choose the right 3PL service provider for your business it is important to understand their pricing models. Let us now understand the major components of 3PL costs. Now these components can vary depending on different 3PL logistics providers.
The onboarding fee is the initial one-time cost that has to be paid for integrating systems, setting up accounts, and aligning workflows.
The storage fee is the amount paid for the space used in the warehouse, storage duration, and the number of SKUs managed.
The picking and packing fee is the amount paid for the entire process of selecting items from the inventory packing them and shipping them.
The shipping fee is the amount determined by the carrier rates, delivery speed, and any negotiated discounts the 3PL provider offers.
Other factors that influence 3PL pricing are,
Outsourcing logistics can simplify operations and save time but going through 3PL pricing comes with its own set of challenges. Let us have a look at the challenges businesses face with 3PL pricing,
Generally, 3PL pricing models are complex, no clear breakdowns make it difficult for businesses to understand how much they are paying for each service leading to a lack of trust.
3PL providers add extra charges like peak season surcharges, special service charges, etc. These are hidden charges that cause frustration for businesses.
Many 3PL providers do not offer services that are tailored for businesses which can end up in small businesses paying extra for services that they do not require.
A standard 3PL fee depends on the services provided by the 3PL providers. Here’s a general breakdown of typical 3PL fees:
SERVICE | TYPICAL RANGE | NOTES |
---|---|---|
ONBOARDING FEES | $200–$1,000 (one-time fee) | Covers initial account setup, system integration, and staff training. |
STORAGE FEES | $5–$15 per pallet per month | Higher for specialized storage (e.g., climate-controlled). |
PICKING AND PACKING FEES | $0.50–$5 per order line item | Additional charges for custom packaging or multi-item orders. |
SHIPPING FEES | Varies | Based on carrier rates, package weight, size, and shipping destinations. |
KITTING | $0.50–$2 per kit | Depends on the complexity of assembly and packaging. |
RETURNS PROCESSING | $2–$10 per return | Costs vary with the complexity of return inspections and restocking. |
CUSTOM SERVICES | Additional Costs | Includes branding, special handling, or other tailored services. |
Cost Component | How to Calculate | Example |
---|---|---|
Storage Fees | Monthly rate × Number of pallets or bins used. | $10/pallet × 10 pallets = $100/month |
Picking Fees | Fee per item × Number of items picked. | $1/item × 2 items × 1,000 orders = $2,000 |
Packing Fees | Fee per order × Number of orders. | $1/order × 1,000 orders = $1,000 |
Shipping Costs | Average shipping cost per order × Total orders. | $5/order × 1,000 orders = $5,000 |
Onboarding Fees | One-time onboarding fee (spread over months, if applicable). | $500 setup fee (one-time) |
Additional Services | Service fee × Number of instances (e.g., kitting). | $1.50/kit × 200 kits = $300 |
Returns Processing | Fee per return × Number of returns. | $5/return × 50 returns = $250 |
3PL monthly price calculation, add up all the expenses,
Total monthly cost $8650.
3PL pricing may appear more expensive due to its fees, but in the long term, it can save costs by improving operational efficiency, offering discounted shipping, and reducing overhead. For small businesses or startups, 3PL may seem costlier initially but becomes viable as the company grows.
The average fulfillment fee per order typically ranges between $5-$15 depending on factors like order size, product type, and shipping destination. This fee includes,
Red Stag Fulfillment is a well-known 3PL provider known for its reliability and efficiency. They believe in caring for their clients’ businesses like their own business. They are known for listening to their clients’ needs and vision and delivering accordingly. Unlike other 3PL providers, they do not have any hidden fees they are very transparent with their pricing instilling a sense of confidence and trust among their customers towards them.
Red Stag Fulfillment does not provide any random pricing on its page you can request a custom quote.
To request a custom quote you need to follow 4 steps.
Step 1: Enter basic details like your name, email, and phone number.
Step 2: The second step is to enter your company name, website, and the fulfillment solution you are using currently.
Step 3: The third step is to add information regarding your logistics like the type of product you sell, average monthly package volume, average package weight, SKU count, percentage of returned orders etc.
Step 4: The final step is to enter information regarding additional information about your fulfillment needs and then submit. Once they review your form they will contact you via email or call.
Provides detailed quotes with no hidden fees and also offers tailored solutions depending on the client’s needs.
Offers order accuracy and speed and high-quality handling of products prone to damage.
Provides a ‘zero shrinkage’ guarantee and discounts on bulk shipments.
Makes use of warehouse management systems and advanced tracking and real-time reporting.
ASPECT | RED STAG FULFILLMENT | OTHER 3PL PROVIDERS |
---|---|---|
Pricing Transparency | Clear, detailed quotes with no hidden fees. | Complex and opaque pricing models, often with hidden charges. |
Customer-Focused Services | High-quality, specialized services for heavy, high-value, or fragile products. | Generalized services are less tailored for specialized needs. |
Cost-Effectiveness for Specialized Needs | Cost-effective for businesses with specialized needs, such as oversized, heavy, or fragile products. Bulk shipment discounts and strong carrier partnerships. | May charge higher fees for specialized services, with potential inefficiencies in handling. |
Overall Customer Experience | Predictable costs, excellent customer support, and guaranteed accuracy and speed. | Can have unexpected costs and a more generic service offering. |
Understanding 3PL pricing is essential for every business to optimize its logistics effectively. 3PL pricing may be complex to understand because of its multiple components. Finding a transparent, reliable, and efficient 3PL logistic provider can become a game changer for businesses as the E-Commerce industry is booming.
Red Stag Fulfillment can be your reliable 3PL provider because of its transparency in 3PL pricing and customized approach. Explore their services today to streamline your fulfillment process and improve your overall business performance!
Key factors include order volume, product size and weight, storage duration, shipping destinations, and additional kitting or custom packaging services.
Red Stag offers a “Zero Shrinkage” guarantee, ensuring accurate inventory handling. They back their service with reliable order accuracy commitments.
Yes, Red Stag’s tailored solutions and competitive pricing cater to businesses of all sizes, especially those with specialized product needs.
Red Stag utilizes advanced warehouse management systems (WMS) and real-time inventory tracking to ensure accuracy, efficiency, and transparency.
Yes, Red Stag provides international shipping solutions through partnerships with leading carriers, ensuring cost-effectiveness and reliability for global deliveries.
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