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What is the different between warehouse and fulfillment center?
Author: Larry Han



Warehouses and fulfillment centers are often thought of as similar and the words used interchangeably.

But they are quite different.

The both fulfillment centers and warehouses are buildings where store inventory for business that sell products to their customer, there is similarity.

The service type is different according case by case. We will explain about each cases as below, and then I'm sure that you can decide to choose which is better for your business.

 

 

What is the warehouse?

 

 

A warehouse usually refers to a commercial building in order to store and manage about your goods and products. You can use a warehouse if your business was for a seasonal product and needed a place to store things during the rest of the year when there is no demand for your product.

The storage in warehouse can make value of goods increase as controlling supply and demand in your side.

It needs to store for maintain the price of goods and products in case of production excess.

Operationally, what happens in a warehouse on a day to day basis is pretty static and simple as below.

1. Receiving the goods or products

2. Checking status and count for goods

3. Moving to location each area

4. Managing Inventory

5. Shipping out

 

Sometimes, warehouse companies are focusing on more business that work with wholesale, or business to business orders that deal with large quantities of products. The big retailer have warehouses where they can store their extra products, or they rent warehouses to share with other customer.

If you're simply looking to store your extra or seasonal products until it has a demand, the warehouse may be better than fulfillment center for your business.

 

 

What is the fulfillment?

A fulfillment center is also a commercial building that stores inventory for a business. However, it also serves many other services as well.

Unlike a warehouse, they are focusing on orders for online market and B2C with retailers, E-commerce company.

A fulfillment center is similar with 3PL (Third party logistics) warehouse, but here is different between them as below.

 - 3PL : usually focusing on B2B orders

 - fulfillment center : usually focusing on online market and B2C

 

In common, retail orders are shipped from a fulfillment center rather than from a warehouse.

Even if you're storing extra products in a warehouse, they can be shipped from the warehouse to a fulfillment center, where they move quickly through the fulfillment center and then out to their final destination with the customer.

Fulfillment centers are often bustling activity. They have been working around the clock to process as below.



1. Receiving the goods or products

2. Checking status and count for goods

3. Moving to location each area

4. Managing Inventory

5. Pick and Pack

6. Labeling

7. Handling return shipment from retailer

8. Shipping out

They have WMS (Warehouse management System) for processing many orders, managing inventory, analysis database, track shipment.

Fulfillment centers are good choice for extenal customer if there was so many additional working (Labeling, repacking, etc).

 

 

Which one is better for you? Fulfillment center vs. Warehouse

 

If you're a small or medium sized business or retailer, it may be important to think about your storage and shipping In & Out.

If you couldn't handle for labeling and repacking and managing return shipment by yourself, you'd better choose fulfillment center service efficiently.

If you're simply looking for warehouse in order to get more space to store your products, the warehouse can provide service (cheap and effective solution).

 

As you are growing with your business and needs more space, you may think to use a warehouse.

For your business, a fulfillment center has much more functionality and can handle many tasks in one place.

 

 

As an e-commerce business seller, it's important to manage your inventory as well in order to use your budget efficiently. Though the terminology is sometimes used interchangeably, fulfillment centers and warehouses have very different functionality. Warehousing companies just store products to be used later, but fulfillment centers manage products with IT system, pick and pack orders, and another many tasks. They get into the hands of your customers in a timely matter.

PNPLINE can handle retailer (Amazon, Walmart, Target, BestBuy, Homedepot, Officedepot, Sam's Club), E-commerce, even B2B, B2C orders and solve lots of matters and needs about in real-time for your business as 3PL warehouse and fulfillment center.

Please don't hesitate contact us if there was any question and requesting.

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