Shipfusion Blog

Fulfillment Center vs Warehouse: What is the difference?

Part One

Choosing the right partner can make or break your company’s logistics, customer service, and repeat purchases. Using a fulfillment center like Shipfusion frees you from navigating the fulfillment landscape with zero stress. Below are some insights on how Shipfusion can take your business to the next level.

Fulfillment Center: The Nucleus of your eCommerce Operation

What is the main difference between a ‘Fulfillment Center’ and a ‘Warehouse’? A traditional warehouse only stores inventory (most times on a long-term commitment). A fulfillment center is an entire operation that briefly stores inventory in the chain of the fulfillment process. Within a Fulfillment Center, the warehouse serves as the central space for inventory in various ways. Goods are sent to the facility and organized in a highly efficient manner. These products are stored in their respective areas until the orders roll in. In essence, warehouses serve as the hub that originates the distribution of products to customers.

In Shipfusion’s fulfillment centers, warehouse professionals are logistics experts equipped with technology to accept inbound shipments, identify products, sort through those products and organize them in a manner that allows for quick and easy retrieval.

Inventory is strategically stored to meet client needs related to safety, security and inventory turnover times. The storage process in a warehouse may seem random, but an efficient and fast warehouse is a priceless one. Conversely, a warehouse that lacks safety, ample spacing and the proper conditions (temperature, humidity level etc.) will inevitably disappoint customers and increase supply chain expense.

Supply Chain Efficiency and Sustainability

The services provided within a well-equipped Fulfillment Center empowers a business to ensure the proper products are readily available exactly when necessary. Whether orders are required to pick and pack, kitting, special storage or handling, assembly or shipment consolidation, the warehouse serves as ground zero for all such protocols. 

Here are a few hidden services that ensure end-customer satisfaction:

Safety Stocking: The level of extra stock that is maintained to mitigate risk of run-out for raw materials or finished goods due to uncertainties in supply or demand. The purpose of safety stock is to ensure that, once you’ve run through your cycle stock (what you were expecting to sell during a certain time period), you’re still prepared for any orders if there is an unexpected change in demand or in the supply.

Central Hubs: Consolidate orders in a highly efficient manner. Consolidation expedites order delivery also serves to free up as storage space in the warehouse and expedites order delivery. From the customer’s perspective, consolidation empowers the business to sell its products at lower costs. Consolidation also allows for order delivery as quickly as possible. In the end, customers who receive low-cost goods promptly are inclined to place repeated orders and remain loyal to the business across posterity.

Digital Automation: Digital automation uses data and software to reduce manual workflows. Automatic identification and data capture (AIDC) technology, like mobile barcoding, is an example of digital automation in the warehouse.

Implementing digital automation technology requires a significant upfront investment. These costs include hardware, software and support contracts and the time and resources needed to implement the systems and train employees. In addition, digital automation can increase the risk of lost or corrupted data and cybersecurity threats.

Shipfusion sets your business on autopilot and combines flexible, reliable fulfillment with powerful, real-time technology. Shipfusion has multiple fulfillment centers across the US and Canada– making it easy to manage your eCommerce business. For more information on how to set your business on autopilot, contact one of our fulfillment specialists today.

“Part of the theme at Shipfusion is that we don't constrain our clients. We work with them as business partners, which allows them great flexibility to work with other 3PL solutions and still take advantage of Shipfusion services.”

Dean Bentley-Falcke
Senior Solutions Architect and eCommerce Specialist
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