What Does a 3PL Provider Actually Cost? A Transparent Guide for UK Brands

There is no single figure that answers the question ‘How much does a 3PL provider actually cost?’ While many brands understandably look for a cost-per-order figure, fulfilment pricing usually includes several different services and charges. What’s included depends on the provider and your agreed fulfilment model. In this guide, we’ll explain what’s included in 3PL costs, what can drive costs up or down, and what to look for when comparing providers.

What does 3PL cost in the UK?

There is no single UK 3PL rate, because fulfilment costs depend on your order volumes, product profile, storage requirements and the services you need. Pick-and-pack may be charged per order or item, while storage, packaging, shipping, returns and additional services can be charged separately.

For this reason, comparing the headline pick-and-pack rate alone can give a misleading picture of your actual fulfilment costs. One of the most useful figures to calculate is your expected total fulfilment cost based on your specific order profile.

Why there is no “standard” 3PL price

Many businesses approach 3PL procurement expecting a simple rate card, but fulfilment requirements vary significantly, which heavily impacts the quotes you may receive.

A standard price would require every brand to have the same circumstances, which is impossible. Every brand we work with has different products, order volumes and service requirements.

For example, a cosmetic brand, public sector organisation and a subscription box provider may all require different fulfilment models. This highlights the importance of working with a provider who truly understands your business and can fulfil your needs.

Focusing on a single figure, such as the number of orders shipped, can make it harder to understand the full cost of fulfilment and may leave important services or charges out of the comparison. Your 3PL pricing structure should reflect your order volumes alongside your operational complexity, product profile and service requirements. Remember, the lowest quote is not always the lowest total cost.

Granby has over 65 years of experience supporting brands across different sectors, with a wide variety of products and fulfilment requirements. This experience allows us to develop fulfilment solutions around each client’s operational needs, rather than applying a one-size-fits-all approach.

The main components that influence 3PL costs

When receiving a quote for 3PL services, it’s important to have this itemised, as this helps to maintain transparency between you and the provider. Here are some of the most common services that may be included in a quote. Some of these may be fixed costs, and others may be variable costs; it depends on the pricing model used.

Goods-in and inventory receipt

Receiving goods is crucial and must be completed to a high standard. It can involve checking quantities, recording stock arrivals and ensuring that there is enough space to store products. At Granby, products are assigned SKUs within our warehouse system, allowing stock to be identified, tracked and traced throughout the fulfilment process.

Warehousing and storage

3PL providers need appropriate storage processes to protect stock and maintain accurate inventory records. Some products may also require specific storage conditions or procedures. At Granby, products are stored according to their specific requirements, including considerations such as expiry dates where applicable. Our warehouse has excellent security procedures, including a caged area for high-value goods, CCTV and on-site security. Read more about our storage and distribution.

Storage may be charged in different ways depending on the provider and the type and volume of stock, including per pallet, bin, shelf, cubic metre or another agreed storage unit. For example, some food products may require temperature-controlled storage or specific handling procedures.

Picking and packing

Picking and packing are core parts of the fulfilment process and require high levels of accuracy. At Granby, our dedicated in-house team can be supported by our trusted bank staff during busy periods.

Picking and packing may be charged based on the number of items in an order, order complexity, packing requirements and agreed order volumes. We are a dedicated packing partner.

Packaging materials

Orders need to be packaged correctly to reduce the risks of damage during transportation. Granby supports brands with all aspects of packaging and recently supported a large chocolate brand with personalised ribbons for Easter.

Packaging costs vary based on the materials used, such as tape, boxes, protective materials and other packaging components. Costs also vary depending on whether your packaging is branded or plain.

Distribution and shipping rates

A 3PL may be able to improve transport efficiency by consolidating shipments, using established carrier networks and planning deliveries effectively.  At Granby, we work with established carrier partners and focus on efficient delivery planning to help reduce unnecessary journeys. This aligns with our sustainability efforts.

Distribution costs vary based on domestic and international deliveries and different service levels.

Returns handling

Many brands only consider returns management when it’s too late. A reverse logistics strategy can improve customer satisfaction, speed up the recovery or resale of suitable stock, and reduce unnecessary waste. Read more about reverse logistics and returns management.

We carefully handle returned items, quality-checking them for faults or damage. Depending on the results of the quality checks, returned items can be restocked where appropriate, refurbished, or safely disposed of where they are no longer suitable for resale. Read about our reverse logistics solutions.

Account management and reporting

Transparency is increasingly important for brands and is a great way to check in on progress and success. We use KPIs within our advanced software to keep brands up to date with figures and progress.

Enhanced reporting, dedicated account management and additional support may be included within the service or charged separately, depending on the provider and agreement.

Value-added services

Many providers, such as Granby, can support brands with value-added services such as kitting, personalisation, relabelling, repacking and promotional fulfilment. These can be essential for making your brand stand out from the competition.

Taken together, these factors highlight why comparing two 3PL quotes based purely on their ‘cost per order’ can be misleading.

What can increase or reduce your fulfilment costs?

• Number of SKUs: A larger product range can increase inventory management requirements and may require additional storage locations or handling processes
• Product size and weight: Larger or heavier products may require more storage space and can cost more to ship.
• Order complexity: Multi-item or customised orders can require more picking and packing time 
• Seasonality: Peaks can require additional labour and operational capacity
• Multiple sales channels: Different channels can create different fulfilment solutions and integration requirements
• International shipping: Customs, carrier options and destination requirements can add complexity
• Special handling requirements: Fragile, sensitive or specialist products may need additional processes
• Returns volumes: Higher returns can create additional handling and processing requirements

The right provider should deliver the services your business requires while maintaining consistent quality as demand changes. At Granby, we are ready to scale with you as your dedicated 3PL partner. With 65 years of experience, we know how to handle busy periods with confidence and maintain high standards.

Additional 3PL costs businesses should watch for

A headline quote may not include every service or variable charge, so it’s important to understand exactly what is included before comparing providers. Here are some common additional costs to watch for, along with questions you can ask to understand the pricing.

Minimum monthly charges

• Is there a minimum monthly spend even if order volumes are lower than expected?
• What happens if our monthly order volume falls below the agreed level?
• Are storage, fulfilment and other services included within the minimum charge?

Inbound handling fees

• Are there additional charges for receiving and processing inbound stock?
• How are inbound deliveries charged? Per pallet, carton, SKU or shipment?
• Are there additional fees for deliveries that require counting, checking or sorting?

Additional pick fees

• What is your standard pick-and-pack rate?
• Is this charged per order, per item or using another pricing structure?
• Are there additional charges for multi-item orders?
• Are there separate fees for split picks, special picks or non-standard orders?

Storage overage charges

• How are storage costs calculated for eCommerce brands?
• What happens if our stock exceeds the agreed storage allowance?
• Are there additional charges during seasonal peaks or periods of higher inventory?

Returns processing

• Is returns handling included in the standard fulfilment price?
• How much does it cost to inspect, process and restock a returned item?
• Are there additional charges for damaged, faulty or non-resalable stock?

Project or implementation charges

• Are there one-off setup or implementation fees?
• Are there additional costs for onboarding, stock migration or warehouse setup?
• Will we be charged separately for process changes, new projects or campaign work?

Packaging surcharges

• Are standard packaging materials included in the fulfilment fee?
• Are branded, bespoke or specialist packaging materials charged separately?
• Are there additional charges for oversized, fragile or unusually shaped products?

Technology or integration fees

• Are system integrations included within the standard service?
• Are there setup or ongoing fees for connecting our ecommerce, ERP or order management systems?
• Are there additional charges for API access, custom integrations, reporting or system changes?

Special handling charges

• Are there additional charges for products requiring special handling?
• Are there any fuel surcharges?
• How are fragile, high-value, temperature-sensitive or otherwise specialist products handled and priced?
• Are there additional fees for labelling, repacking, quality checks or other manual processes?

Peak-season surcharges

• Are peak-season surcharges applied to our account?
• When do they apply?
• Which services do they affect?
• How are they calculated?
• Are they already reflected in the quoted rates?

Potential exit and offboarding costs

• What notice period applies?
• Are there minimum contract commitments?
• Are there charges for stock removal or stock counts?
• Are there costs associated with transferring data or closing integrations?

Before agreeing to a 3PL contract, ask the provider whether any additional or variable charges are included in the main pricing structure.

How to calculate your real 3PL cost

As a starting point, businesses can estimate their monthly fulfilment cost by adding together:

Estimated monthly fulfilment cost = Receiving + storage + pick & pack + packaging + shipping + returns + account/technology fees + value-added services + other applicable charges

Estimated cost per order = Total monthly fulfilment cost ÷ monthly orders

For a more realistic comparison, calculate this for both an average month and your peak month. This provides an indicative figure for comparison, but the exact calculation will depend on how your 3PL structures its pricing.

What can happen when fulfilment doesn’t meet expectations?

When choosing a 3PL partner, take your time and consider their experience, systems, and more. Otherwise, you may face operational inefficiencies and additional costs that aren’t immediately apparent when you first compare quotes. Operational issues can create additional costs and lead to customer service problems. These may include:

• Stock inaccuracies
• Delivery delays
• Customer service issues
• Poor inventory visibility
• Slow response times
• Inflexible processes
• Limited reporting
• Operational inefficiencies
• Difficulties scaling during peak periods

Granby uses advanced, in-house-built technology, including our warehouse management system (WMS). This provides visibility across the fulfilment process, from goods-in and inventory management through to distribution and returns. We maintain high standards throughout the entire supply chain, giving you better insights and more control.

What should be included in a good 3PL quote?

A detailed quote can tell you a lot about how a provider approaches your requirements and what is included within its service. We suggest that you look for the following elements in a quote.

• Clear pricing structure
• Defined SLAs
• Reporting capabilities
• Inventory management processes
• Technology access
• Returns management
• Account management support
• Scalability provisions

A transparent quote isn’t necessarily the one with the lowest individual rates. It’s the one where the business can understand exactly what it is paying for. When you request a quote from Granby, you’ll get full transparency into what’s involved and how we can support your brand. 

You must take the time to compare providers properly and ensure they are all offering logistics costs based on the same service level. 

Beyond warehousing: The value-added services that drive ROI

A great 3PL provider can do more than just store and distribute products for you. Many of these value-added services relate to contract packing, such as relabelling, personalisation, kitting and assembly. 

Granby also supports brands with quality checking and reverse logistics, helping to recover suitable stock, reduce unnecessary waste and support positive customer experiences. We work with brands on promotional fulfilment during seasonal peaks or other times of the year. Read our blog on high-volume contract packing.

Questions to ask internally before comparing 3PL pricing

• What is our average number of items per order?
• What are our typical product dimensions and weights?
• How much stock do we hold at an average point in time?
• How many SKUs do we have?
• What percentage of orders are returned?
• What are our seasonal peaks?
• Do we sell through multiple channels?
• Do we ship internationally?
• Do we require specialist handling or packaging?
• What reporting and inventory visibility do we require?
• Do we need kitting, contract packing or personalisation?
• What customer experience are we trying to achieve?
• What growth do we expect over the next three years?

What does a 3PL provider actually cost?

As this guide has shown, there is no one-size-fits-all 3PL price. Costs depend on your products, order volumes, storage requirements, operational complexity and the services you need.

Rather than comparing providers on a headline cost-per-order figure, businesses should consider total fulfilment cost and understand exactly what is included in each quote. A good 3PL quote should be transparent, clearly structured and capable of scaling alongside your business.

If you’re looking for a trusted 3PL provider to support your business, then look no further. Granby is here to scale with you and provide end-to-end solutions. Contact us today.