Standard fulfillment company services
Storage and warehousing
A fulfillment company stores items until an order for the item comes in.
Storage facilities can be prepared for perishable items requiring
refrigeration, temperature sensitive items requiring air conditioning or
heating (such as certain types of chemicals that can break down due to
extreme heat or cold), or typical warehousing protection from the
Third party fulfillment services will often charge a storage fee based
on the product storage requirements and any special handling that may be
A fulfillment company will typically maintain and publish inventory
counts as goods are shipped. Reporting systems can vary by company and
range from simple excel spreadsheets to web-based systems.
Pick and pack services
Pick and Pack is the process of selecting items currently being stored
by the fulfillment company to prep for shipping. Companies have
employees known as "pickers" that will receive an order manifest. These
"pickers" will then wander the warehouse to the location (known as a BIN
or INTERNAL SKU) of the individual items, and pull them from the
warehouse shelves to prep for shipping. With the "picker" taking the
items in the order manifest back to the packing station, another
employee known as a "packer" will then check to make sure all items in
the order manifest are present and then begin the packaging process.
Packaging of the product according to its type is then performed,
optionally, a packaging slip may be attached, and the product is labeled
with address identification of where the item is to be shipped.
A packaging slip may not always be required to accurately pick the
contents of an order. Other methods of product identification exist,
such as Pick to Light, and BINQTY strings, that allow for accurate
picking of items. Such newer methods, allow for an increase in
productivity. However, systems of picking items for shipping will vary
based on variables such as the number of items, and sku diversity of the
goods to be shipped.
It is rare for a fulfillment company to provide its own courier services
due to the size of courier companies. In most cases, the shipping is
outsourced to courier or delivery companies. However, often fulfillment
companies are able to provide larger shipping discounts than smaller
retailers may be able to negotiate on their own merit. This is because
fulfillment service providers ship a high volume of orders every day.
Because of this volume, small parcel carriers such as UPS, DHL, and
FedEx will negotiate a better discount. For smaller, light-weight
parcels, USPS will often be used (typically 1 pound and under).