3PL Pricing Models – Here are the options

Companies looking to outsource their warehousing are keen to understand what pricing options are available to them.

Generally, there are 3 categories:

1. Transactional Billing-   this is an activity based cost model and is the most popular, given the attraction of a user-pays concept.

The charges are constructed  as follows:

  • storage ( per pallet per week)
  • devanning per FCL ( full container load),
  • receipt & putaway( by unit, pallet, carton)
  • order assembly ( base fee plus per unit/line/pallet)
  • hourly rate to cover stocktakes, rework, etc.

2. Cost /Plus model – a fixed monthly fee constructed from base costs with a margin added

3. Percentage of Sales revenue. A rarely used option, but one that remunerates the 3PL provider based upon the owner’s sales revenue generation.

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