But more options can make the decision process more difficult, especially when your Shopify store’s fulfillment strategy can make or break your business. With that said, it’s important to make the right choice, so your logistics operations doesn’t slow down growth and cut into profit margins.
Depending on your order volume, the types of products you sell, and where your customers are located, you will need to decide which fulfillment method makes the most sense for your unique business.
This guide provides insights into:
- Different Shopify fulfillment options available to you
- How Shopify fulfillment works
- Top Shopify fulfillment services
- Benefits of partnering with a 3PL
How fulfillment can make or break your Shopify shop
Picture this: You’ve spent countless hours designing your Shopify website, setting up marketing campaigns, and designing custom packaging.
But as soon as orders are placed, it’s up to you to figure out how to fulfill orders accurately and quickly to get them shipped. If an online store is unable to deliver customer orders in a timely manner, customers can easily find what they need somewhere else.
There is a lot to keep in mind when it comes to fulfillment. The entire process involves start with Shopify inventory management and storing, then picking and packing items accurately, and shipping Shopify orders. If you fulfill orders yourself, then you will need to figure out how much packaging, software, shipping, and all of the other logistics will cost you.
Before you launch a Shopify store, be sure to consider how you will handle fulfillment, so you don’t spend too much time and money packing and shipping orders and get stuck in an endless cycle.
The 3 main fulfillment options a Shopify store owner has
If you’re just starting out or have the means to hire a staff and rent a warehouse, it is possible to fulfill orders yourself. While this gives you absolute control over every step of the supply chain, it can also take up too much time and drive up logistics costs as your business expands.
As brands grow online, it’s not uncommon to switch from in-house fulfillment to outsourcing fulfillment sooner than later. This allows you to leverage someone else’s fulfillment operations, rather than investing in fulfillment infrastructure, including warehousing, labor, equipment, fulfillment software, and more.
Note: This option may be best if you’re selling locally only and primarily have in-store pickups.
Dropshipping is the most hands-off fulfillment option, but it gives you much less control over the fulfillment process. If you opt for dropshipping, the order fulfillment process is entirely managed by the manufacturer.
Though there are pros and cons to dropshipping, this fulfillment method tends to have a much longer transit time (often coming from Asia) and greater quality control risks since your customer is the first one to see your finished product.
“When we first got started, we were dropshipping. It was nice because we had no money tied up in inventory, but we also had no quality control.
With no control over the customer experience and very poor shipping times, we quickly realized dropshipping was not a long-term solution. It was good for proving out an early concept, but we had to move to a professional fulfillment company.”
Gerard Ecker, Founder & CEO of Ocean & Co.
3. Third-party logistics (3PL)
To save time and money while still maintaining control, many fast-growing Shopify stores partner with a 3PL.
Many 3PLs offer multiple fulfillment centers (including international fulfillment locations), leading technology that automates and streamlines inventory processes, and data and analytics that help you make better decisions across your supply chain.
A 3PL’s fulfillment center is designed and optimized to be as efficient and effective as possible, from the equipment they use and labor flow, to their use of space and technology to increase accuracy.
3PLs partner with shipping carriers to negotiate discounted shipping rates, which allows you to offer more shipping options. Best of all, you can tap into a 3PL’s technology, distribution network, and expertise, while not having to pack orders yourself.
“I shipped everything myself and made a lot of trips to the post office. It was intense and pretty tough. You quickly reach that breaking point, where you cannot do it any longer, and it’s not worth the compromised quality of life.
We did some market research, and I knew some other brands that used ShipBob. Everything just works. We are super happy with ShipBob and very impressed by how well they’ve pumped out our large volume of orders.”
Sergio Tache, CEO of Dossier
(Note: Shopify recently launched Shopify Fulfillment Network (SFN), which offers packing and shipping services. Acting as an on-demand warehousing solution, SFN partners with other warehouses and 3PLs to utilize their technology and operations.)
How Shopify fulfillment works
Once your customer places an order through your Shopify or Shopify Plus website, the order needs be quickly located and picked from the warehouse, packed and labeled, and then shipped as soon as possible. To optimize the supply chain, Shopify allows you to decide how you want your fulfillment strategy to operate.
Shopify Fulfillment Network: pros and cons
Some brands are testing out Shopify’s new order fulfillment network service that is still getting off the ground. Below we compare ShipBob to the Shopify Fulfillment Network.
Shopify Fulfillment Network
|Fulfillment experience||Operates fulfillment centers of its own since 2014 and owns its entire tech stack including the warehouse management system (used across all of its fulfillment centers), trusted by thousand of Shopify brands||Announced their fulfillment network in 2019 and outsources fulfillment to different 3PLs and uses each 3PL’s WMS|
|Order volume and ideal merchant size||Has a Growth Plan for startups and can take on businesses doing 80,000 orders/month or more; can handle over 200 SKUs if there is a shipment to SKU count ratio of 4:1||Works with brands that ship between 3 and 200 orders per day (or 84 – 6,200 orders/month); only works with brands with under 200 SKUs|
|Products fulfilled||Can generally fulfill products that carriers can ship (if unsure, request a quote here to have a fulfillment expert weigh in), including products that require serial, lot, or batch tracking, or a first-in-first-out (FIFO) inventory policy||Doesn’t work with any regulated or perishable products, those that need lot tracking, products where the total package weight is over 35 pounds’ or longer than 18 inches in any single dimension, prohibited items including hand sanitizers and CBD products, and some items they consider restricted|
|Pricing||You have one fee for each order fulfilled (not separate line items for packing supplies and picks are included up to the first 4 items); monthly billing for storage; and inbound receiving (see more here)||You have a separate fee for picking and packing, packing supplies, and shipping for each order fulfilled; monthly billing for storage; and inbound receiving|
|Countries available||Can work with businesses located anywhere and has fulfillment centers in the United States, Canada, Poland (EU), England (UK), and Australia||Only for businesses that sell in the United States and has fulfillment centers in the US and Canada|
|Onboarding process||Very fast with the average implementation taking 30 days, though some get onboarded in as soon as 9 days||You have to apply and get accepted to move forward (no clear timeline listed on their site)|
|B2B fulfillment||Can handle B2B fulfillment for brands doing primarily DTC fulfillment||No B2B offered|
The biggest benefits of Shopify fulfillment with a 3PL
From warehousing to shipping, a 3PL partner can save you time and money on ecommerce fulfillment.
Here are some of the many ways a 3PL like ShipBob can have a meaningful impact on your Shopify fulfillment process.
Warehouse management can not only take a considerable amount of time, but it’s also a big investment for a lot of effort, which could be used on other aspects of your ecommerce business.
3PLs like ShipBob not only offer access to a wide network of distribution centers, but they also are skilled in optimizing storage and storing ecommerce inventory strategically to speed up the warehouse picking process without compromising order accuracy.
To provide a consistent fulfillment service across an entire distribution network, 3PLs use a warehouse management system (WMS), which controls and monitors operations throughout the warehouse.
By allowing someone else to manage warehousing tasks, you don’t have to worry about storing inventory, managing and training staff, and investing in technology and equipment.
“It felt like all I did was eat, sleep, and pack orders. We couldn’t fit another person in my garage. I had to make a transition in order to scale.
Since working with ShipBob, we’ve grown 115% and experienced 2.5 times more order volume. It was kind of like magic — my orders were imported into ShipBob from my Shopify Plus site and started getting fulfilled right away. I didn’t have to do anything.”
Noel Churchill, Owner and CEO of Rainbow OPTX
A tech-enabled 3PL provides built-in inventory management tools, which allows you to view real-time stock levels at each fulfillment center, proactively set reorder points to prevent stockouts, and get insights on insights into inventory performance, such as what items are best-selling versus slow-moving.
“We have a Shopify store but do not use Shopify to track inventory. In terms of tracking inventory, we use ShipBob for everything — to be able to track each bottle of perfume, what we have left, and what we’ve shipped, while getting a lot more information on each order.
The analytics are super helpful. We download Excel files from the ShipBob dashboard all the time and use them to analyze everything from cancelations, to examining order weights, to checking on whether ShipBob is shipping orders on time.
Even the way their warehouse receiving orders (WROs) work for sending inventory is very straightforward.”
Ines Guien, Vice President of Operations at Dossier
Each product will have its unique packaging needs. Some need to be packed more carefully than others, where items can safely be shipped in simple poly mailers.
Depending on the carrier and other requirements, a 3PL provider will use the right type of standard packaging materials and the right amount of dunnage (some, at no extra cost).
3PLs like ShipBob also allow you to use custom packaging to create a memorable unboxing experience. This option also provides provides control over packing materials, including the option to choose eco-friendly packaging.
“I wanted a good unboxing experience and would wrap each pack in tissue paper and add a sticker. I spent about 3 minutes per order on fulfillment. I almost didn’t want orders to come in. I had to find a fulfillment partner and began looking for an all-in-one solution. ShipBob was the exact solution I was looking for.”
Leonie Lynch, Founder & CEO of Juspy
Since 3PL companies deal with a wide range of carrier partners, such as UPS, USPS, FedEx, and DHL, as well as regional parcel carriers, and work with hundreds to thousands of merchants, they are able to negotiate bulk rates on domestic and international shipping.
Tapping into a 3PL’s carrier partner network allows you to pass the savings on to your customers. This way, you can offer more shipping options and incentives, such as free shipping.
(Note: It’s recommended to do research to understand fulfillment costs. Some 3PLs are known to nickel and dime every little fee, where others only charge for basic line items like receiving inventory, warehousing, shipping, and then any other additional services.)
The 4 best Shopify fulfillment services
If you’re looking to outsource fulfillment, Shopify makes it easy to leverage fulfillment services provided by a third-party. Here is an overview of the leading Shopify fulfillment services to consider.
ShipBob fulfills orders for thousands of Shopify stores — more than any other fulfillment provider. ShipBob is an official Shopify Plus Certified App Partner and has the most advanced fulfillment technology on the market.
With access to best-in-class fulfillment services, ShipBob partners with Shopify stores to put fulfillment on autopilot, offer faster and affordable shipping, as well the the ability to expand into new channels and markets.
ShipBob’s technology allows you to maintain visibility into the entire fulfillment process, track inventory in real time, filter all orders by status, view fulfillment and shipping performance insights, and much more.
ShipBob also partners with other leading ecommerce solutions, which makes it easy to connect ShipBob to your existing tech stack and enable an end-to-end ecommerce solution.
“For our website, we built it on Shopify, as we are very comfortable with them. Shopify and ShipBob work very well together. All I had to do was click a couple buttons and they were connected.
The integration and visibility of the two systems keeps everything very simple. I really like ShipBob’s dashboard. It’s our backend logistics that keeps us up-to-date on everything that’s happening.”
Tim Fink, Co-Founder of EnduroSport
Once integrated with your Shopify store, ShipBob plays a significant role in reducing shipping costs and improving last-mile delivery while saving you time on logistics.
“The Shopify Plus Certified App program is designed to meet the advanced requirements of the world’s fastest growing brands. We’re happy to welcome ShipBob to the program, bringing their insight and experience in fulfillment to the Plus merchant community.”
Loren Padelford, GM of Revenue at Shopify Plus
ShipBob’s 2-Day Express Shipping increased our AOV by 97% — from $75 to $148. And we were able to scale our business from $300,000 in sales per year to over $1.1M.
Ryan Casas, COO of iloveplum
2. Red Stag Fulfillment
Red Stag Fulfillment provides services similar to ShipBob, but they specialize in shipping heavy items and oversized shipping. They offer easy integration with Shopify, as well as custom API. Red Stag’s fulfillment software is cloud-based, which allows you to access your data and reports from any device at any time.
Red Stag’s fulfillment services are ideal for businesses that ship heavy and/or oversized packages. Due to the care and costs involved with managing heavier products, Red Stag is good for businesses selling products that are outside of a small or lightweight scope.
3. Shopify Fulfillment Network
The Shopify Fulfillment Network (SFN) provides this new service for Shopify merchants. With SFN, you can store inventory across the globe, as well as access data such as order tracking, inventory labels, and customer data.
Choosing Shopify to take care of fulfillment comes down to what you sell, as well as your monthly order volume. It’s important to note SFN’s requirements for Shopify brands:
- Must be located in the United States
- Must have fewer than 200 SKUs
- Must ship between 84 to 6,200 orders a month
- Can’t sell regulated or perishable items
Amazon’s Fulfillment by Amazon (FBA) program manages logistics for brands that list products on Amazon. FBA is only for products on Amazon that have the Prime status and is the most expensive fulfillment service option when selling on Amazon.
Amazon offers other alternatives to FBA, including Seller-Fulfilled Prime (SFP) and Fulfilled by Merchant (FBM), which involve someone other than Amazon (like a merchant or 3PL) fulfilling orders placed on the marketplace.
Note: ShipBob offers FBM services, which can help you diversify your fulfillment options to maximize sales. Learn why sellers have moved off of Amazon to ShipBob for FBM here.
To sell through multiple channels, Amazon also offers Multi-Channel Fulfillment (MCF). MCF inventory connects to your Shopify page and allows you to manage product listing and fulfillment from a single location.
How to set up ShipBob on your Shopify site
ShipBob’s technology makes it easy to connect your Shopify or Shopify Plus store in minutes. Once your store is connected to ShipBob, you can begin to ship inventory to one or multiple ShipBob fulfillment center locations. Once ShipBob receives inventory, orders placed on your Shopify store will automatically be sent to ShipBob to be picked, packed and shipped.
“ShipBob has an easy integration with Shopify. It’s been very simple for us to manage subscription orders, which have become a big part of our business. We’ve gained a 13% savings to our bottom line.”
Pablo Gabatto, Business Operations Manager at Ample Foods
To get started, here are simple steps on how to connect Shopify to ShipBob.
Step 1: Link Shopify to ShipBob
Log in to your ShipBob account, and launch ‘Quick Setup,’ then ‘Store Integration.’ Follow the setup workflow to authorize the linking of Shopify and ShipBob. This includes setting ShipBob as a ‘Custom Fulfillment Service’ on your Shopify account and choosing ‘Have ShipBob create a fulfillment service for you.’
Step 2: Sync inventory
Migrate inventory by syncing products from your Shopify store with ShipBob. This real-time sync will ensure that you are able to access and track inventory and fulfillment details on ShipBob’s dashboard.
Step 3: Customize account preferences
In this step, you may manually choose the ‘Fetch Orders Every 2 Hours’ so that ShipBob monitors Shopify orders regularly. Also, the ‘Look Days Back’ option directs ShipBob to start managing older shipping orders.
Step 4: Send your inventory to ShipBob
Once you connect Shopify with ShipBob and inventory is synced, you can choose which fulfillment center locations to store inventory in. From there, you can begin to ship inventory to ShipBob, starting by filling out a warehouse receiving order (WRO), or the documentation that helps to keep the warehouse receiving process efficient and accurate.
Get ShipBob’s WMS for Shopify fulfillment in your own warehouse
Have your own warehouse? ShipBob’s Shopify fulfillment capabilities are for you, in addition to ShipBob’s best-in-class warehouse management system (WMS) for brands that need help managing inventory in real time, reducing picking, packing, and shipping errors, and scaling with ease.
With Merchant Plus, brands can even leverage ShipBob’s fulfillment services in any of ShipBob’s fulfillment centers across the US, Canada, Europe, and Australia to improve cross-border shipping, reduce costs, and speed up deliveries.
Launching a Shopify store opens your business up to customers across the globe. But to meet customer expectation, no matter where they live, having access to a robust fulfillment infrastructure and technology is key.
ShipBob is a best-in-class 3PL that partners and integrates easily with Shopify, so you can outsource logistics effortlessly, save money, and meet customer expectations on speed and shipping costs.
“The ShipBob integration with Shopify is so easy that even I can do it — and I need a reminder of how to turn on the TV. It’s that seamless and intuitive that even my mom, in her 60s, has helped me. I showed her how to use ShipBob’s technology and it was so easy for her, too.”
Anastasia Allison, founder of Kula Cloth
ShipBob brings years of fulfillment expertise to the table and is a premium fulfillment partner for direct-to-consumer (DTC) brands on Shopify, as well as other leading ecommerce platforms.
To learn more about how ShipBob can help you optimize fulfillment for your Shopify store, click the button below.
Shopify fulfillment FAQs
To understand Shopify fulfillment better, here are answers to commonly asked questions.
Does Shopify offer fulfillment?
Shopify offers their own fulfillment services known as Shopify Fulfillment Network, but because it is new, there are limitations. Many Shopify merchants partner with a 3PL like ShipBob, which offers an easy integration between Shopify and ShipBob’s technology. The Shopify and ShipBob integration automates the shipping process by automatically sending orders to the 3PL’s fulfillment center(s) to be picked, packed, and shipped.
How do I set up fulfillment on Shopify?
Setting up fulfillment on Shopify is a pretty intuitive process. First, you will need to choose your fulfillment method: dropshipping, in-house fulfillment, or 3PL. If you decide to use a 3PL’s fulfillment services, then you will need to connect your Shopify account to the 3PL’s technology. Next, decide if you want the processing to happen automatically or manually. For new products, you can individually assign fulfillment methods to each. For more information, click here.
What is fulfillment?
Fulfillment is the process of assembling and shipping a customer order. Unlike having customers come to a physical retail store to select and purchase items themselves, an online merchant is responsible for packing the ordered items and getting the package in transit as soon as possible.