Fulfillment center vs. warehouse: what’s the difference?

By Oleg Mikhailenko
Published in Solutions
April 17, 2022
3 min read
Fulfillment center vs. warehouse: what’s the difference?

In articles and thinkpieces about e-commerce, you often see the terms “fulfillment center” and “warehouse” being used interchangeably. But are they really the same thing? What are the differences between them? And for that matter, what is order fulfillment, and what does fulfillment mean in terms of shipping? Read on to discover key differences between these terms, as well as handy definitions that will put you well on your way to becoming a pro.

Order fulfillment: meanings and definitions

If you want to talk about fulfillment, it’s helpful to first define a few business terms before you jump right into the wide world of order fulfillment solutions. When someone talks about fulfillment processing, for instance, what does that mean? Strictly speaking, it’s everything that happens after an order is placed. From the data being transferred to the partner facility, to the picking and packing of the order, to the labeling of the box, and then right up to the moment the package is delivered at the customer’s door. This is a lot of separate processes bundled up into one term, so it’s always helpful to specify which part of the whole event you’re discussing beforehand. Fulfillment status, for instance, is a term which has a more precise meaning– namely, it’s a metric that tells you exactly which part of the process your order is currently undergoing, whether your package is sitting in a warehouse (or distribution center) or on the road speeding towards its destination.

So, what’s the difference between the two?

“Order fulfillment center” and “warehouse” are two terms which are often conflated, and in colloquial use, there’s really no problem with that. They carry out a lot of the same purposes, so it’s understandable why someone with a casual understanding of the industry might confuse the two. If we define these terms more strictly, however, a few distinct differences become clear. A warehouse is simply any building which stores goods. Importers, exporters, merchants, or pretty much anyone might have cause to store items in a warehouse for a period of time, whether or not they’re actually involved in commerce. Think of ancient civilizations, storing months worth of food in grain silos - it’s not likely they were heavily engaged in order fulfillment logistics!

Meanwhile, a fulfillment center is involved in every part of the logistics and execution of the fulfillment service. From picking to packing to shipping and even negotiating rates with courier services. They’re really a one-stop shop that handles everything from the moment they receive and unload your goods to the moment they send them off to the end customer, completing the fulfillment cycle. As many e-commerce merchants get into e-commerce out of a desire to sell fantastic products without having to go through the hassle of maintaining a physical retail location, these centers allow sellers to outsource storage and packaging services so they can focus on the parts of their business that make them excited each and every day.

How do they work?

Now you know the difference between these two types of partner facilities, but you might still be confused as to how you might go about booking one. Not to worry. P2Pseller has it all covered. Make a free account with us today in order to browse our offerings. We let literally anyone with spare space monetize that space by uploading it onto an open and democratic marketplace so you can make sure to book facilities and services that coordinate well with your unique business needs.

In contrast to stagnant logistics companies who require you to spend long hours on the phone with someone constantly trying to upsell you into booking services you don’t need, or (even worse) force you to fill out a form and hope you hear back with a price quote in time, P2Pseller shows you all availability dates and prices up front, before you commit. This means that you have to deal with zero stress, zero phone calls, and zero hidden fees. You can spend your time focusing on growing your business and pleasing your customers rather than wrestling with a fulfillment partner that cares more about their bottom line than your partnership.

If you’re just getting started on your e-commerce journey, it can be confusing to orient yourself in regards to all these terms being thrown around. By taking the time to read up, though, it’s only a matter of time before you’ll be an expert in your field. We here at P2Pseller are proud to help you on your journey as you scale your infrastructure, smash profit records, and grow your business more each and every day.


Tags

#order#fulfillment#logistics#definition#warehouse#customer#shipping#processing#services#solutions#business
Previous Article
Where exactly is my package? Shipping notifications explained

Oleg Mikhailenko

Co-Founder, CEO P2Pseller

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