3PL vs In-House Fulfilment: Pros, Cons, and Cost Breakdown

As your ecommerce business grows, one of the biggest operational decisions you’ll face is whether to keep fulfilling orders yourself or outsource to a third-party logistics provider (3PL).

Both models have their advantages and drawbacks. What works for a handmade jewellery brand sending out 20 parcels a week might be completely unsustainable for a rapidly scaling clothing label processing 500 orders a day.

In this article, we’ll compare in-house fulfilment and outsourcing to a 3PL.

📦 What’s the Difference Between 3PL and In-House Fulfilment?

In-house fulfilment means you manage the entire process yourself, storing inventory, packing orders, printing labels, and handing off parcels to couriers. It gives you full control but can be time-consuming and difficult to scale.

3PL fulfilment involves outsourcing those tasks to a logistics partner. You send your stock to their warehouse, and they handle picking, packing, shipping, returns, and more, often using their own software and courier network.

✅ Pros and Cons at a Glance

Factor	In-House Fulfilment	3PL Fulfilment
Control	Full control over stock, packing, and branding	Less direct control, but customisation is possible
Cost	Lower upfront for small volumes	More cost-effective at scale
Time investment	High – manual packing, dispatch, returns	Low – handled by 3PL team
Scalability	Hard to scale quickly	Easy to scale with growth
Speed of delivery	Slower unless optimised	Faster with multi-location warehousing
Flexibility	High (if you have time/resources)	High – many offer custom solutions

🧠 Pros & Cons Explained

🏠 In-House Fulfilment

✔ Pros:

• Full control over the customer experience

• Easier for custom, handmade, or fragile products

• No external contracts or commitments

• Potentially cheaper when order volume is low

✘ Cons:

• Time-consuming (especially during peak periods)

• You need your own storage space, equipment, and supplies

• Difficult to maintain fast delivery standards as you scale

• Not cost-effective at high order volumes

🚚 3PL Fulfilment

✔ Pros:

• Saves time, no more late nights packing parcels

• Lower shipping rates thanks to bulk courier discounts

• Faster delivery via regional warehouses

• Easily scale with demand (e.g., during sales or peak season)

• Advanced software with fast despatch and order tracking

✘ Cons:

• Less direct control (though many offer branding options)

• Onboarding/setup takes time initially

• May be more expensive if your order volume is very low

• Requires trust in an external partner

💷 Cost Breakdown: In-House vs 3PL

Let’s look at where the money goes in each model.

In-House Fulfilment Costs

• Storage – renting space or using your own (opportunity cost)

• Packaging materials – boxes, tape, labels, filler

• Shipping costs – usually higher retail courier rates

• Labour – your own time or staff wages

• Software – order management, label printing, inventory tools

🔎 Many small businesses underestimate the true time cost of packing and dispatching orders daily.

3PL Fulfilment Costs

• Receiving fees – for accepting and processing inbound stock

• Storage fees – charged per pallet/bin/shelf per month

• Pick and pack fees – flat rate per order or per item

• Packaging – often included or charged separately

• Shipping – discounted courier rates (often cheaper than retail)

• Software – often included with your 3PL account

💡 While 3PL pricing varies, it’s usually transparent and easy to forecast as you scale.

📈 When to Switch from In-House to a 3PL

Here are signs you may have outgrown DIY fulfilment:

• You’re fulfilling more than 100 orders per month

• You’ve run out of storage space

• You’re spending hours each day on packing and shipping

• You can’t keep up with customer service and returns

• You want to offer faster delivery options (like next-day)

• You’re preparing for peak season or a product launch

🧭 Which Option is Best for You?

Business Type	Recommended Fulfilment Model
Handmade/artisan products	In-house (customised control)
Small brand < 100 orders/month	In-house or a 3PL that handles small qty's
Growing DTC brand	3PL for scalability and speed
Subscription box business	3PL (kitting and bulk fulfilment)
Seasonal or flash sales	3PL (handles sudden spikes)
International shipping	3PL (cheaper courier options)

🔚 Final Thoughts

Fulfilment is a critical part of the ecommerce customer journey, but it doesn’t have to overwhelm you.

If you’re in the early stages, handling fulfilment yourself may give you the control and cost savings you need. But as your business grows, shifting to a 3PL can help you save time, reduce operational stress, and deliver a better experience to your customers.

The right choice depends on your volume, goals, and how much of your time you want to spend packing boxes.

📣 Want to Scale Without the Stress?

Packitle helps ecommerce brands across Australia and New Zealand streamline operations with reliable, fast, and cost-effective 3PL fulfilment.

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