When e-commerce sellers decide to explore outsourced fulfillment, a common first step is requesting quotes from several 3PL providers.

That makes sense.

But comparing the storage and pick-and-pack numbers at the top of each quote may not tell you which provider will actually cost less.

One of the biggest variables can be hiding in your shipping costs.

Ask How Shipping Charges Are Calculated

Many 3PLs qualify for negotiated carrier discounts because of the volume of packages they ship.

The important question is what happens to those savings.

Are the negotiated rates passed directly to you? Or does the 3PL add a markup?

Some providers can keep storage, picking, and packing prices very competitive while generating additional revenue through shipping markups.

Those markups may not appear in a quick online quote.

A Small Shipping Markup Can Become a Big Expense

Consider a brand selling items with batteries or components requiring hazmat handling.

If carrier costs average $8.50 per order, a 20% shipping markup adds another $1.70 per shipment.

At 1,000 orders per month, that’s:

$1,700 in additional costs every month.

Over 12 months, that becomes $20,400 in additional annual shipping expenses.

Suddenly, saving a small amount on a pick-and-pack fee doesn’t look nearly as important.

This is why comparing 3PL pricing based on one or two advertised fees can be misleading.

Three Questions to Ask Every 3PL

Before comparing quotes, ask each potential fulfillment partner:

1. Are negotiated shipping rates passed through at the carrier’s actual cost?
2. Is a shipping markup added, and if so, how much?
3. Can you provide my all-in cost per order for the last three months?

That last question is especially important.

An all-in cost per order gives you a much better basis for comparing providers than examining storage, fulfillment, and shipping charges separately.

Know Whether You’re Ready Before Requesting Quotes

Of course, comparing providers only makes sense once you’ve determined that outsourcing is appropriate for your business.

If fulfillment is consuming hours of your day, storage is becoming difficult, shipping costs are increasing, or inventory management is getting harder, it may be time to investigate your options. Those are among the operational signals included in Sweetwater Logistics’ ten-question assessment.

Take the 3PL Readiness Assessment to determine whether your business is ready to outsource fulfillment.

If your results indicate it’s time to start evaluating 3PLs, look beyond the headline prices. Compare what it actually costs to fulfill and ship an order from beginning to end.