UPS eFulfillment vs. Amazon FBA for Order Fulfillment
Interested in UPS’s new eFulfillment service? The service allows you to fulfill orders for 21 marketplaces, including major ones like Amazon, eBay, Etsy, Shopify, and Walmart!
Features and services are likely to change. Please check the UPS eFulfillment website for latest pricing and features, as figures used in this article may have changed.
Let’s take a look at the features of UPS eFulfillment and how the costs compare to Amazon FBA.
Benefits of UPS eFulfillment
- Manage inventory and orders in one place
- Same-day fulfillment up to 5pm on 1-day, 2-day, and 3-day service
- Supports 21 marketplaces, including Amazon
- Simple, bundled pricing
At the time of this article, UPS charges $0.93 per cubic foot per month for storage based on size and average inventory.
In addition to storage costs, rates are divided into three zones, A, B, and C, and fulfillment costs are based on weight. Take a look at the costs for UPS eFulfillment.
For example, the price for two-day shipping for a 1 pound item to zone A is $8.19 ($7.84 base rate + $0.35 per pound).
Shipping to Canada is also available.
UPS currently has a 60-day trial where the minimum monthly fee of $1,000 is waived. Once that trial period ends, users will pay whatever their shipping fees and storage costs are for the month OR $1,000, whichever is higher.
With our sample shipping cost of $8.19, you’d have to ship approximately 4-5 orders per day to go above the $1,000 monthly minimum.
Amazon FBA vs. UPS eFulfillment
Costs will vary based on what products you’re selling and how long they sit before they sell.
To start, Amazon’s storage fees begin at $0.69 per cubic foot and go to $2.40 per cubic foot during Q4 for standard-sized products. You’ll also have increased rates for long term storage (after 365 days).
UPS doesn’t have a long term storage fee, nor is there a higher storage fee for Q4. The rate of $0.93 per cubic foot per month is fixed.
To fulfill an order for an iPad Mini 4 case, FBA costs $2.41. Amazon shoppers generally expect fast delivery, and Prime members usually get 2-day shipping.
UPS eFulfillment would cost $8.19 for the same 2-day service.
The difference in cost is significant for smaller and lighter items. But heavier items shipped through UPS may be cheaper, depending on the location.
For instance, a 20-pound tire that measures 25 in x 25 in x 9 in would cost $15.10 to fulfill through FBA (small oversize rate of $8.26 + $0.38 per pound above the first 2 pounds).
UPS eFulfillment would cost $14.84 for 2-day shipping to Zone A.
Of course, there are other considerations. For instance, FBA handles all customer service, but some sellers may prefer handling customer service for more complex products.
There are other considerations when deciding on a fulfillment service like inbound shipping costs, removal fees, and other processes like damage and lost products at the warehouse.
Do the calculations to see if using UPS eFulfillment makes sense for your business.
Even if the fulfillment and shipping fees are slightly higher, sellers on multiple marketplaces may still save money overall by using one integrated service.
Don’t forget that you can still use Amazon to fulfill orders from other marketplaces through Amazon’s Multichannel Fulfillment service (MCF).
Streamlining your fulfillment to one service may actually save you money. Your employees won’t have to learn multiple processes. As a result, you’ll make fewer mistakes due to having one service provider instead of multiple ones.
Read these related articles on shipping and fulfillment: