A fulfilment centre is a third-party logistics (3PL) facility that takes on the work involved in managing inventory and processing orders for ecommerce companies. Unlike traditional warehouses, these facilities are specifically designed for storage and order fulfillment, allowing businesses to take the strain off of in-house operations and focus on driving growth.

Does Amazon use a fulfillment center?

A fulfillment center handles everything from the management of inventory to the storing and shipping of product, often under specific conditions (cold storage, for example). When stock is shipped in from vendors, the center typically receives a purchase order or supplier’s order confirmation. It then stores the items until they’re ready to ship. Depending on the specific requirements of the business, this could mean the goods sit on shelves or pallets, or they may be labelled with inventory and shipped directly to end customers via B2C or wholesale channels.

Fulfillment centers also communicate with merchants and end users throughout the entire fulfillment process, whether it’s an order confirmation at the outset or status updates throughout the handling of a shipment. This helps to build trust with consumers, and it ensures that customers can expect a smooth delivery experience.

As a bonus, because fulfillment centres operate at scale, they can save on warehousing costs and pass the savings on to clients. This can be a major benefit for smaller companies looking to experiment with new markets without the risk of investing in their own warehouses.

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