A fulfillment center, sometimes called a fulfillment house or warehouse, is a facility for storing merchandise prior to its shipment to customers. In contrast to traditional warehouses that tend to have the appearance of massive storage depots with rows and rows of inventory piled high on pallets, fulfillment centers are spread out over many thousands of square feet because items from different vendors are stored in smaller quantities. Items may be kept in bins or boxes or shelving racks. The area where a customer picks up an item is generally called a pick face.
Fulfillment centers handle the entire order fulfillment process for their clients, including receiving orders from websites, packing them appropriately for safe shipment and shipping them off to the client’s customers using the eCommerce merchant’s preferred carrier — UPS, FedEx or the US Postal Service.
Fulfillment centers can be owned and operated by eCommerce merchants and website fulfillment services. They tend to warehouse any item a company might sell: books, music, household products, clothing and food as well as more specialized items such as jewelry, artwork and electronic equipment. FBA (Fulfilled by Amazon) fulfillment centers are those that work directly with Amazon as opposed to fulfillment by merchant (FBM). Merchants who want their items listed on the world’s largest online retailer use fulfillment services so they don’t have to invest in one of their own fulfillment centers.
The goods stored in fulfillment centers range from inexpensive items like books or CDs to expensive high-tech products such as video game consoles and laptops. Many fulfillment centers focus on specific categories and inventory tends to come from many different sources including drop shippers, retail stores and direct manufacturers. Bulk orders for the same item tend to be stored in one place so fulfillment operators can easily check inventory levels and restock as required.
When a fulfillment center receives an order, it is entered into its system and the computer automatically allocates the warehouse location where that particular product will be stored — whether that means placing it in a box or putting it on a shelf or rack according to the type of item and where it falls in size (longest/largest/thinnest) within its category. For example, books would be stored together by height; boxed games might be stored next to each other by width; and DVDs might be stored next to each other by length.
When the fulfillment center receives an order, it is checked out of inventory and sent through a packing station where it is readied for shipment. Employees are responsible for putting together the items an individual customer has purchased — gathering them from their bins or shelves, putting them into appropriate boxes or packaging materials, affixing shipping labels with the required address information and depositing the fulfillment in a designated area so it can be picked up by UPS or another delivery service that will take it to its final destination.
The fulfillment process often begins long before the fulfillment center receives the first item to ship. Websites typically send their fulfillment center lists of items to store well ahead of time. This fulfillment list may contain images and descriptions of the goods so fulfillment operators know exactly what to look for when restocking shelves or bins.
Fulfillment houses provide their clients with a host of services including returns processing, order tracking and more. They handle all tasks related to creating and fulfilling orders from start to finish. For this reason, they tend to focus on working with smaller companies that don’t have the time, resources and manpower to invest in such an operation themselves.
A warehouse can be considered a fulfillment center because it fulfills product requests by stocking items that need picked, packed and sent out; however, fulfillment centers are generally larger than warehouses . And while fulfillment centers do everything necessary to create an order — receiving it, picking and packing it and getting it on its way — warehouses only stock the items for fulfillment centers to pick and pack.
