3PL Pricing Explained: A Complete Cost Guide for 2025

Picture this: Your first fulfillment invoice arrives, and it’s nearly double what you expected.

Suddenly, your carefully calculated margins are under threat.

This scenario plays out daily across ecommerce businesses because 3PL pricing is far more complex than it appears on the surface. What looks like a straightforward fulfillment quote often masks intricate pricing structures that can dramatically impact your profitability.

Without understanding these complexities, you risk choosing a pricing model that slowly erodes your margins. And even experienced operators can miss crucial details that impact their bottom line.

To expose the hidden costs and complexities of 3PL pricing, we consulted five 3PL industry veterans:

Together, they’ll show you exactly how to evaluate 3PL pricing, spot hidden fees before they damage your business, and negotiate rates that protect your margins. No logistics degree required.

Why there are no “ballpark” 3PL prices in this post

If you’re reviewing a 3PL quote, you likely want to know one thing: “Is this a good price?”

While many sources offer “typical” fulfillment pricing ranges for individual line items, these oversimplified estimates mask the true complexity of 3PL pricing.

Here’s why comparing individual line items doesn’t work:

Brandon Cantrell, Chief Commercial Officer at Red Stag Fulfillment, explains the solution:

Joe Spisak, CEO and Founder at Fulfill.com, confirms: 

Here’s a complete breakdown of all the hard and soft costs that go into ecommerce order fulfillment:

This guide breaks down every aspect of 3PL pricing, from core services to shipping fees to negotiation strategies. Remember: The number that matters most is your total fulfillment cost, including both direct and indirect expenses.

A complete breakdown of 3PL pricing

We’ve broken down all of the services, factors, and fees that might affect your 3PL pricing. Click to jump directly to each section. 

Common services and associated costs

• Onboarding and setup
• Receiving and inbounding
• Storage and warehousing
• Handling
• Packaging
• Value-added services
• Account management and support
• Reverse logistics

Shipping fees (these are so complex they get their own section)

• Package weight and dimensions
• Distance and zones
• Residential surcharges
• Fuel surcharge
• Minimum charges
• Location-based surcharges
• Demand and peak surcharges
• Service speed
• Carrier rates and discounts
• Additional handling surcharges (AHS)

Other factors that affect pricing

• Order volume and frequency
• Product characteristics
• Number of warehouses and warehouse locations
• Service Level Agreements (SLAs)
• Niche fit

Common services and associated costs

At its core, a 3PL needs to receive, store, pick, pack, and ship your inventory. Fees mirror these services, with some added complexity. 

Onboarding and setup

Common onboarding costs include integrating your Enterprise Resource Planning (ERP) and Warehouse Management System (WMS) with the 3PL’s platform. 

While many 3PLs offer plug-and-play integrations that keep costs low, custom solutions may require additional IT labor and software licensing fees to connect your data systems.

Receiving and inbounding

This covers the cost of accepting deliveries from your manufacturers or existing facilities. 

NOTE: The proximity of your 3PL’s warehouse to your manufacturer or port of entry significantly impacts inbound costs. Choosing a warehouse close to your product’s origin point can slash your inbound transportation costs, though this benefit may be offset by higher outbound shipping to customers.

Once your shipment has arrived at the warehouse, a variety of factors can affect cost:

Storage and warehousing

3PLs typically charge for storage using one of two models:

Planning your storage needs

Blair highlights two questions that often catch brands off guard: 

• “How much inventory would you require the 3PL to hold on average, and how quickly do you turn your inventory? 
• Are your sales consistent year-round, or do storage requirements fluctuate depending on the season?”

Common storage fees to watch for

Beyond basic storage space rates, watch for:

Handling

Handling covers the core work of getting your products from warehouse shelf to shipping dock. 

Basic handling includes:

These fees can be broken down into several categories:

Pick and pack fees

Most 3PLs charge pick and pack fees in one of these ways:

Special handling requirements

Heavy, bulky, fragile, and hazardous items often incur extra fees due to:

Runyan explains where the extra fees can come from:

Multi-unit orders

Orders with multiple items may trigger:

Packaging costs

Packaging fees fall into three main categories:

If you’re going to use specialized protection—or any packaging that is beyond true necessity—consider how that will impact your bottom line. As Brandon Cantrell, Chief Commercial Officer at Red Stag Fulfillment warns:

Value-added services

3PLs may offer premium services beyond basic fulfillment, each with its own fee structure:

These premium services typically cost extra through:

There’s also a risk of misunderstanding the pricing of these services. To avoid these surprises, ask for clear pricing breakdowns and client references before committing to specialized services. As Cantrell notes:

Account management and support

3PLs may offer tiered account management and support options. This can range from access to shared customer service teams to having your own dedicated account manager.

Reverse logistics

Returns have become a critical part of ecommerce operations, yet many 3PLs treat reverse logistics as an afterthought. When evaluating return processing costs, watch for:

How to decode (and reduce) your shipping fees

Shipping fees are among the most complex parts of fulfillment pricing. There are a lot of moving parts, and the carriers (UPS, FedEx, USPS, and other regional carriers) are constantly updating their prices and cost structures. Staying on top of these changes is a full-time job. 

Let’s break down each component that affects your total shipping costs.

Package weight and dimensions

Your shipping rate starts with weight, but it’s more complex than simply putting a package on a scale. Carriers use two calculations:

They charge whichever is higher, which means a large, lightweight package might cost more to ship than a small, heavy one.

Distance and zones 

Carriers divide the country into shipping zones, numbered from 2 to 8 for the U.S. states. (Zone 9 is used for some territories and military bases). Here’s an approximation of the zone map based on Red Stag’s warehouse locations.

The zone number is based on the carrier (different carriers use different maps) and the distance from your shipping origin to the delivery destination. As Cantrell explains:

Residential surcharges

Delivering to homes costs more than delivering to businesses due to:

Fuel surcharge

The fuel surcharge fluctuates regularly based on national diesel prices. This fee is calculated as a percentage of your base shipping rate and can significantly impact your total shipping cost. While this surcharge can change often, it typically adds 10-15% to your total shipping cost. Runyan elaborates:

Minimum charges 

Every shipment comes with a minimum charge, regardless of how small or light your package might be. These base rates vary depending on several key factors:

Think of it this way: While carriers adjust their pricing based on your package’s size, weight, and shipping distance, there’s a floor they won’t go below. Even when shipping a tiny, lightweight package to the next town over (Zone 1), the carrier still has fixed costs to cover—from pickup to sorting to final delivery.

Understanding these minimum charges is crucial for accurate shipping cost projections, especially when dealing with smaller items that might seem inexpensive to ship. 

Location-based surcharges

Carriers charge additional fees for deliveries to less accessible or remote locations:

These surcharges can significantly impact total shipping costs. For example, if 20-30% of your orders ship to DAS zones, your average cost per package could increase by several dollars.

Demand and peak surcharges 

Holiday season surcharges have evolved beyond just holiday fees. As Runyan explains:

These surcharges typically appear during:

Service speed 

Your choice of service level should balance customer expectations with shipping costs. Each speed option comes with its own pricing structure and delivery guarantees.

Common service levels include:

The faster the service, the higher the base rate and associated surcharges. However, strategic warehouse placement can help you reach customers quickly using more economical shipping methods.

The actual delivery speed your customers experience depends on two factors: how quickly your order leaves the warehouse and how fast it travels to its destination. Many 3PLs offer same-day fulfillment with later cutoff times—meaning your package starts its journey the same day the order is placed rather than sitting in a queue overnight. This lets you provide faster delivery without paying for expedited shipping services.

Carrier rates and discounts 

3PLs typically secure better shipping rates than individual businesses because they leverage their combined shipping volume across all their clients to negotiate deeper carrier discounts. These discounts can apply to both base rates and surcharges.

Key negotiable elements include:

Additional handling surcharges (AHS) 

Large or irregularly shaped packages often trigger AHS fees. However, there’s an important detail many shippers miss:

Other factors that affect pricing

Line items aren’t the only thing you need to look at—these indirect factors can dramatically impact your total fulfillment costs.

Order volume and frequency

Your order patterns shape both pricing and operations. Understanding when and how orders arrive impacts your costs in several ways:

Product characteristics

Product attributes significantly influence pricing structure:

Number of warehouses and warehouse locations

While more warehouses might seem like an obvious path to lower costs—your products are closer to customers, after all—the reality is more complex. Adding locations creates significant costs and operational challenges that often outweigh the savings on outbound shipping:

• Higher inventory costs.
  You’ll need more total inventory to stock multiple locations, tying up capital. Plus, you’ll face new costs from balancing inventory between facilities.
• Increased inbound shipping expenses.
  Splitting shipments between facilities often means shipping partial loads via LTL instead of full containers, raising your per-unit costs.
• Complex pricing structures.
  Each location adds new variables to your cost equation: different labor rates, varying real estate costs, and location-specific operating expenses.
• Reduced efficiency.
  Smaller facilities typically have higher per-unit operating costs due to duplicated overhead and reduced economies of scale.

Rich Patterson, former enterprise sales director at ShipBob, puts it plainly: “If you’re not producing close to 5 million in GMV, or only ship 50-100 orders per day, you don’t need multiple locations.”

Chad Carleton, Founder and CEO of Good Company (a 3PL), confirms this:

Service Level Agreements (SLAs)

An SLA defines the specific performance standards your 3PL must meet across all aspects of fulfillment. These agreements typically cover four key areas, each affecting your pricing:

The more stringent your SLAs, the more you’ll pay. For example, if you want a 5 PM cutoff for same-day shipping, your 3PL needs to maintain higher staffing levels later in the day. They may need to pay overtime or run additional shifts to process these late orders. A next-day cutoff, while offering lower costs, means orders placed after the cutoff won’t ship until the following business day. As Cantrell explains:

Premium providers typically offer stricter SLAs backed by financial guarantees, while budget-friendly providers may offer more basic service levels at a lower price point.

The key is matching your SLA requirements to your business needs. For example:

• If you sell high-value items, paying more for zero shrinkage and near-perfect accuracy may make financial sense. 
• If you sell lower-margin items, a small shrinkage allowance might cost less than paying the premium for zero shrinkage guarantees. 
• If most customers choose standard shipping, an early cutoff time could reduce your fulfillment and warehousing costs without affecting satisfaction. 

Niche fit

Most 3PLs will be particularly good at certain niches, and your pricing will reflect that. 

Spisak emphasizes the importance of a 3PL that aligns with your product type:

A 3PL that fits your niche has other benefits, too—they may be able to negotiate shipping discounts on a certain product type or size, and can configure the warehouse, equipment, and automation in a way to support your products.

How to maximize value in 3PL pricing 

Understanding 3PL pricing is just the first step. To truly maximize the value you get from your fulfillment partner, you need strategies that go beyond comparing rate cards.

Build strong communication channels to control costs

Poor communication with your 3PL can quickly erase any pricing advantages through hidden fees, shipping delays, and inventory management problems. 

Here’s how to use communication to protect your bottom line:

Set clear expectations upfront 

Before signing a contract, establish exactly how pricing updates, fee changes, and surcharge notifications will be handled. “When [fees] aren’t clearly communicated upfront, they can feel like ‘gotchas,’ leading to frustration and distrust,” Spisak explains.

Schedule regular performance reviews 

Set up monthly check-ins focused on three key areas:

Watch for red flags 

A 3PL’s communication during the sales process often predicts how they’ll handle your account. If they’re vague about fees or slow to respond before earning your business, expect these issues to worsen once you’re a client. This can lead to unexpected costs and missed optimization opportunities.

Forecast inventory accurately

Detailed forecasting helps your 3PL optimize operations and reduce your per-order costs.

For example, when Cantrell is talking to a prospective client, he likes to get:

Optimize product packaging

A simple way to reduce costs is minimize package size. 

Work with your manufacturer to optimize product packaging dimensions—remember, even one inch of excess space drives up both storage and shipping costs.

Leverage volume and carrier discounts

3PLs offer two main opportunities for cost savings:

• Volume discounts through tiered or all-in pricing agreements that adapt to your business demands (you won’t pay more during a demand surge). 
• Access to pre-negotiated carrier rates that are typically lower than what individual businesses can secure on their own. 

Align your needs with the 3PL’s strengths

Every 3PL excels in different areas based on their equipment, processes, and supply chain expertise. 

Custom packaging requirements illustrate how this can affect your partnership: One 3PL might charge premium rates because they lack specialized equipment, while another includes it as a standard service. Instead of paying higher fees or immediately dismissing the first 3PL, explore alternative approaches. They may be able to achieve your packaging goals using their existing workflows in a different but equally effective way.

The key to maximizing value isn’t finding a 3PL that perfectly matches every requirement—it’s identifying creative solutions that leverage their unique strengths. Work with your potential 3PL partner to understand their capabilities and identify efficient ways to meet your needs. Often, slight adjustments to your processes can align with their specialized equipment and workflows, reducing costs while maintaining quality.

The hidden costs of “budget” 3PLs

A low rate might look appealing on paper, but choosing the cheapest 3PL often costs more in the long run. 

Jon Blair learned this lesson the hard way at Guardian Bikes. Their “budget-friendly” 3PL offered the lowest shipping rates but failed to deliver orders on time, lost inventory, and damaged their brand reputation.

Runyan confirms that cheap fulfillment can cause serious problems:

How cheap 3PLs cut corners

Budget 3PLs typically reduce costs in five key areas, each creating significant risks for your business:

• Deceptive pricing that moves costs to hidden line items.
  While base rates look attractive, these 3PLs often inflate charges elsewhere through mysterious fees, complex surcharges, and hidden minimums that dramatically increase your total cost.
• High shrinkage allowances that permit inventory loss.
  Many budget providers allow up to 4% of your inventory to disappear without consequence. For a business with $1 million in inventory, that’s $40,000 in product the 3PL can lose without penalty.
• Minimal quality control during fulfillment operations.
  To reduce labor costs, these fulfillment centers often skip crucial quality checks during receiving, picking, packing, and shipping. This leads to more errors, damages, and customer complaints.
• Limited peak season capacity.
  Budget 3PLs rarely invest in the extra staff and infrastructure needed to handle holiday rushes and seasonal spikes. When volume increases, their service levels plummet.
• Outdated technology lacking real-time visibility.
  Instead of investing in modern warehouse management systems, cheap 3PLs often use basic or outdated software that can’t provide accurate, real-time inventory data or order tracking.

The true cost of cheap fulfillment

These corner-cutting practices create expensive problems that extend far beyond basic fulfillment fees:

• Lost or damaged inventory: Without proper systems and controls, products regularly disappear or arrive damaged at customers’ doors
• Late deliveries: Poor processes and understaffing lead to missed ship dates and angry customers
• Angry customers: When orders arrive late, damaged, or not at all, customers blame your brand, not your 3PL
• Brand damage: Each negative customer experience erodes trust in your business and can lead to lost future sales
• Higher replacement costs: You’ll spend more replacing lost or damaged items than you saved on cheaper fulfillment
• Operational headaches: Your team will waste countless hours managing problems, tracking down lost orders, and dealing with customer service issues
• 3PL closure risk: If your budget 3PL suddenly closes, you’ll face a scramble to find a new provider and may struggle to recover your inventory

Spisak confirms this reality: 

The bottom line: two things matter most

When evaluating 3PL pricing, look past individual line items and focus on what truly impacts your business:

• Your total fulfillment cost.
  A 3PL’s higher storage fees might be offset by lower shipping rates. Another’s attractive handling costs could mask expensive surcharges. Only by calculating your all-in cost per order can you make meaningful comparisons between providers.
• Your customer experience. As Blair explains: “Your customers don’t know it’s a 3PL behind the scenes, and even if they do know, they don’t care. They see it as an extension of your brand.” Your fulfillment partner must execute flawlessly because every package shapes how customers view your business.

Understanding how a prospective 3PL’s pricing will translate to the invoices you’ll receive each month is a lot of work—both from you and the 3PL. Invest the time now to save yourself pain later.

And beware of any 3PL that will give you pricing based on an email exchange or 15-minute call. It might feel good to get something quickly now, but there’s nothing worse than getting huge sticker shock when you receive your first invoice.

Want to understand what fulfillment services should really cost? Let us analyze your fulfillment data and show you exactly where you could be saving money.

Contact Red Stag for a consultative review of your fulfillment costs today.