In-House vs Outsourced Fulfilment: Which Is Right for Your Business?

As an ecommerce business grows, fulfilment can quickly become one of the biggest demands on your time, space and resources.

At first, packing orders yourself can make perfect sense. But what happens when those handfuls become hundreds or thousands of orders?

At that point, many ecommerce businesses start considering whether to continue managing fulfilment themselves or partner with a professional fulfilment company.

There is no single answer that works for every business. The right choice depends on your order volumes, the sector you are operating in, available space, team, growth plans and how much time you want to spend managing the day-to-day logistics of getting orders to customers.

In this guide, we’ll look at the key differences between in-house and outsourced fulfilment, the benefits and drawbacks of each approach, and the questions you should consider before making a decision.

What Is In-House Fulfilment?

In-house fulfilment means your business manages the entire fulfilment process itself. This typically includes:

• Receiving and checking stock
• Storing products
• Managing inventory
• Picking orders
• Packing orders
• Arranging deliveries
• Managing shipping queries
• Processing returns
• Keeping stock levels up to date

For a small ecommerce business, this might initially happen from a spare room, garage or small office. As order volumes increase, businesses may move into dedicated warehouse or commercial space and employ staff to manage fulfilment.

The major advantage is control. Your team handles every part of the process and can make changes whenever necessary. However, your business is also responsible for the storage space, staff, equipment, packaging, systems and time required to keep orders moving.

What Is Outsourced Fulfilment?

Outsourced fulfilment means using a specialist fulfilment company to manage some or all of your order fulfilment process.

Instead of storing your stock and packing orders yourself, your products are delivered to a fulfilment centre. When a customer places an order, the fulfilment company picks the relevant products, packs the order and arranges delivery.

Depending on the provider and your requirements, outsourced fulfilment can also include:

• Stock receiving
• Warehouse storage
• Pick and pack
• Order processing
• Courier management
• Returns handling
• Inventory management
• Ecommerce platform integrations
• Subscription management
• Bespoke packaging
• Fulfilment transfers
• Freight and logistics services

This allows your business to outsource much of the operational work involved in getting products from your warehouse to your customers.

In-House vs Outsourced Fulfilment

The biggest difference is simple, with in-house fulfilment, you manage the operation yourself. With outsourced fulfilment, a specialist partner manages it on your behalf. Both approaches have advantages.

	In-House Fulfilment	Outsourced Fulfilment
Control	Complete control over the process	Shared with your fulfilment partner
Storage	You provide and manage the space	Stock is stored at the fulfilment centre
Staffing	Your team handles fulfilment	Fulfilment provider manages the operation
Picking & Packing	Managed internally	Managed by the fulfilment provider
Scalability	You need to add space and resources as you grow	Capacity can scale with your requirements
Time	Requires ongoing management	Frees your team to focus elsewhere
Infrastructure	You invest in your own setup	Specialist infrastructure is already in place
Peak Periods	You need to plan additional capacity	Provider can help manage increased demand

• The Benefits of In-House Fulfilment
  • Complete control – When fulfilment happens under your own roof, you have direct control over how orders are picked, packed and dispatched. This can be particularly important for businesses with highly customised packaging or products that require specialist handling.
  • Direct access to your stock – Your team has immediate access to your inventory, making it easy to inspect products, make changes or handle unusual orders.
  • Flexibility – If you want to change your packaging, add an insert to every order or introduce a new process, you can make the change yourself without relying on an external partner.
  • It can work well at lower volumes – If you’re only sending a small number of orders each week, managing fulfilment yourself may be straightforward and cost-effective. The challenge is making sure the setup continues to work as your business grows.
• The Drawbacks of In-House Fulfilment
  • It takes time – Picking and packing orders can consume a significant amount of your working day. As order volumes increase, fulfilment can take time away from activities that directly contribute to growth, such as marketing, product development and customer relationships.
  • You need space – Stock, packaging materials and finished orders all need somewhere to go. What starts as a few shelves can quickly become an entire room, office or warehouse.
  • Growth requires more resources – If your order volumes increase, you may need additional staff, storage space, equipment and systems. A sudden increase in demand can make this particularly challenging.
  • Peak periods can be difficult – Sales events, seasonal demand and successful marketing campaigns can create sudden increases in orders. If your fulfilment operation is designed around your average order volume, a significant spike can quickly create a backlog.
• The Benefits of Outsourced Fulfilment
  • Free up your time – Instead of spending hours managing orders, your team can focus on growing the business. That could mean spending more time on marketing, customer service, new products or expanding into new sales channels.
  • Scale more easily – A professional fulfilment operation is designed around processing orders efficiently. This means you don’t necessarily need to find additional warehouse space or recruit a new fulfilment team every time your order volumes increase. For growing businesses, this flexibility can be particularly valuable.
  • Reduce the pressure on your business – When fulfilment is handled by a specialist, you don’t have to manage every part of the process yourself. Stock arrives at the fulfilment centre, orders are processed and products are picked, packed and dispatched on your behalf.
  • Access specialist infrastructure – Fulfilment companies have the warehouse space, equipment, processes and systems required to manage ecommerce orders at scale. This can allow smaller businesses to access infrastructure that would otherwise require significant investment.
  • Manage changing demand – Your order volumes won’t necessarily stay the same throughout the year. Promotions, seasonal trading and unexpected increases in demand can all affect the number of orders you need to process. A flexible fulfilment setup can make it easier to manage these changes.
• The Potential Drawbacks of Outsourced Fulfilment
  • There are additional fulfilment costs – Outsourced fulfilment typically involves costs for services such as storage, picking and packing, receiving stock and shipping. However, these costs need to be considered alongside the costs of running fulfilment yourself, including warehouse space, staff, packaging, equipment and your own time.
  • You need a reliable partner – Your fulfilment company becomes an important part of your customer experience. Late shipments, inaccurate orders or poor handling can ultimately affect how customers view your brand. It’s therefore important to look beyond price when choosing a fulfilment provider.

When Should You Consider Outsourcing Fulfilment?

There isn’t a specific order volume at which every business should outsource. Instead, consider what is happening within your business. You may want to explore outsourced fulfilment if:

• Fulfilment is taking up too much of your team’s time
• Your stock is taking over your available space
• You’re regularly struggling to keep up with orders
• You’re expecting significant growth
• Your order volumes fluctuate throughout the year
• You’re preparing for a major sales campaign
• You’re expanding into new sales channels
• You want to offer faster or more reliable delivery
• Managing returns is becoming difficult
• You’re spending more time on logistics than growing the business

What About Businesses With Smaller Order Volumes?

One common misconception is that outsourced fulfilment is only suitable for large ecommerce businesses, but that’s not necessarily the case.

Every business has different fulfilment requirements. A smaller business may value the flexibility of outsourcing just as much as a larger business, particularly if it is growing quickly or doesn’t want to commit to additional warehouse space and staff.

Rather than building an entire fulfilment operation around your business before you know how large it will become, you can use a fulfilment partner to provide the infrastructure you need as your requirements change.

How Much Does Outsourced Fulfilment Cost?

There isn’t a single price for outsourced fulfilment. The cost will depend on factors such as:

• Number of orders
• Number of products per order
• Amount of stock stored
• Product size and weight
• Storage requirements
• Packaging requirements
• Delivery destinations
• Returns
• Additional services

To get an accurate quote, contact NGL Fulfilment today.

Flexible Fulfilment for Growing Businesses

At NGL Fulfilment, we understand that every ecommerce business is different. You don’t need to be shipping thousands of orders every month to benefit from professional fulfilment, and your requirements can change as your business grows.

Our flexible fulfilment services are designed to support businesses of all sizes, whether you’re shipping 10 orders or 10,000. From receiving and storing your stock through to picking, packing and dispatching customer orders, we can handle the fulfilment operation while you focus on growing your business.

And because there are no minimum order volumes, you can use the fulfilment support you need without committing your business to volumes you haven’t reached yet.