Businesses need storage space that sometimes isn’t offered to them inside the office or their small rental space. Fulfillment centers and warehouses provide solutions. Which of the two solutions works best for a company’s specific needs varies, however, since each facility is quite unique in its offerings.
Warehouse vs. Fulfillment Center
Warehouses and fulfillment centers share a common goal of storing and shipping goods for a business. We will discuss the numerous differences between fulfillment centers and warehouses in this review so you can better decide which works best for your business needs.
What is a Warehouse?
Warehouses are designed primarily for the storage of materials and goods. The materials and goods could be anything from building supplies used in commercial and residential construction projects or clothing for an e-commerce clothing store. Warehouses offer storage space and the equipment needed to safely store items, including shelving, pallets, and racks.
Warehouses receive and store goods, pick orders, pack orders, ship orders, and secure inventory management. The benefit of using a warehouse is having a central location for products placed for distribution or sale.
What is a Fulfillment Center?
Fulfillment centers store materials and goods in the same way as a warehouse, although their list of services exceeds those available elsewhere. A specialized facility that focuses on fulfillment process optimization, fulfillment centers like AMS Fulfillment allows quicker order turnaround times, easier tracking and processing, and enhanced efficiency.
Fulfillment centers accomplish more functions than a warehouse thanks to the incorporation of advanced technologies such as automated picking systems and robotics to help expedite the processes.
Differences Between a Warehouse & Fulfillment Center
The technology used and the level of automation are two of the fundamental differences between warehouses and fulfillment centers. Advanced automation systems generally allow fulfillment centers to streamline their order processing while minimizing errors, and handle higher volumes of orders more efficiently.
Warehouses typically rely on human and manual labor and do not use advanced automation systems. They do not streamline the order process and often use only recommended traditional storage systems.
The focus of the entire operation is the key reason for the differences. A warehouse typically stores and manages inventory. Fulfillment centers focus on several aspects of order fulfillment. The layout of the two centers is unique. Fulfillment centers do not offer as much flexibility in their layout since they have separate areas for order picking, accuracy, packing, and shipping. Warehouses are more flexible. They can accommodate numerous types of storage requirements. Warehouses often offer areas for bulk storage or temperature-controlled zones.
The order management systems used by fulfillment centers also highlight a key difference between them and warehouses. The order management systems include inventory management software, transportation management software, and inventory control. The integrations allow real-time order tracking, seamless coordination and shipping, and many other features that you cannot find inside warehouses.
Benefits of Using Fulfillment Centers
Fulfillment centers offer numerous advantages over warehouses. Some of the biggest advantages include:
- Fulfillment centers provide complete order processing and fulfillment solutions for businesses, including picking, packing, and shipping. Using fulfillment centers allows businesses to focus on other aspects of operation while ensuring customers receive excellent customer service.
- Small, medium, or large-sized businesses can use fulfillment centers since they easily accommodate small or high volumes of orders. Businesses that cannot handle these order fulfillment tasks themselves or live in spaces without enough space get what they need at a fulfillment center.
- With fulfillment centers across counties and states in various locations, business owners can help save money by reducing shipping costs. Additionally, reduced shopping times can improve customer happiness. With centers strategically placed, levering order fulfillment is much easier and far more streamlined.
- Fulfillment centers use advanced technology and automation systems to improve efficiency, save money, and reduce hassle while securing customer satisfaction. Fulfillment centers use software and technology that improves shipping time, and order accuracy, reduces errors, and allows customers to enjoy other benefits, including easy order tracking
Businesses That Benefit From Fulfillment Centers
A wide range of businesses can benefit from using fulfillment centers rather than warehouses, including:
- Seasonal Businesses: Businesses that operate during specific times of the year waste money using a warehouse year-round. A fulfillment center provides a place to scale up or down as business needs change without wasting money or changing spaces.
- Crowdfunding Campaigns: Funding a new start-up is expensive and stops many businesses before it gets off the ground. Crowdfunding helps new businesses get started with help from funding from several people. Crowdfunding campaigns that depend on the use of products benefit from fulfillment centers to handle the processing of these goods.
- E-Commerce Retailers: Online retailers need a storage facility to store products or their own homes may become cramped and overcrowded with goods. A fulfillment center not only gives e-commerce business owners a storage solution, but an all-around order fulfillment processor. E-commerce business owners may then focus more attention and time on sales, marketing, and customer service.
- Small Businesses: Small businesses with limited infrastructures, resources, and funding benefit from fulfillment centers. Business owners may continue to focus on sales and marketing while the fulfillment center ensures prompt order fulfillment. This streamlined service doesn’t cost a small fortune, giving another advantage to small businesses when it’s most needed.
- Subscription Box Services: Subscription box services are popular these days. People look forward to receiving their monthly box of goods. Businesses need a place to store the goods that go into the boxes and make sure customers get their boxes each month. Fulfillment centers ease both needs, making it possible to succeed.
- International Sellers: International sellers save money using fulfillment centers to ship their goods to various countries. Any business currently selling products internationally or that plans to make this transition in the future should consider fulfillment centers.
Warehouse Center or Fulfillment Center: Which is Best for Business?
Warehouses and fulfillment centers provide order fulfillment services to businesses looking to enhance order processing and customer satisfaction. Each offers different features and services, so evaluate the pros and cons before choosing the best storage space for your goods.