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How Much Do Warehousing Services Cost?

June 27, 20180Warehouse

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How Much Do Warehousing Services Cost?

June 27, 2018 0Warehouse

One of the first questions business leaders want to know when they talk to our team is : How much do warehousing services cost? Although this is not an exhaustive article, it will provide general guidelines. If you’d like to get a full quote on your warehousing needs please click below:

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The decision to use a fulfillment centre is similar to deciding when to hire your first employee or not. Unlike salaries, warehouse services are generally a variable cost. Which is beneficial because if your activity is low, so are your costs.

That being said, not all products are the same. Just as an entry level employee requires $30,000 on an annual basis a salary can range for specialized employees that can demand $100,000+.

A lot of business owners are afraid of outsourcing aspects of their business. With less control, how can you guarantee a ROI? This is why it is so important to understand a 3PL’s process, cut off times and cost structures; because this will be an extension of your business operation.

Full disclosure: TQS Logistics offers warehousing services. Some businesses may not be a fit for this model, to learn more please contact us.

What are the factors effecting the range of costs?
  • Volume
  • Type of good
    • Perishable
    • High value
    • Location of storage facility
  • • Picking requirements
    • Kitting
    • Palletizing
    • Is special packaging required?
  • Shipping
    • Expedited
    • Mode
    • Stackable
    • Density/Volumetric
  • Returns
    • Inspections
    • Repackaging
  • Visibility/IT
    • Is a tracking portal required?
    • Are there EDI/API integrations?
Cost Table

All costs are in CDN

Receiving/Returns

When receiving product, it is important to understand how the product is arriving and what needs to be done before putting it away into storage. This pricing is done based on pallets/cartons and for crates, any other type of package please contact for more details.

$100 – 250 per TL (truckload)

$200 – 350 per 20’ container

$350 – 450 per 40’ container

$5-15 per pallet

$1-5 per carton

$5 – 10 per pallet

$7 – $15 for palletization

$2-5 per return

$5-10 per return w/ inspection & repackaging

Monthly Storage

Are you running out of storage for your inventory or is your storage expense high?

Many merchants don’t consider storage as a part of their fulfillment expense. If you are spending money on a facility or seeing increases in your fees, get a quote from a third-party logistics provider and compare. You might be surprised to learn your storage costs could be used better supporting fulfillment.

Opposed to renting a facility which costs at least $100,000 annually, you could be paying only for the space you use.

Note: most warehouses will only charge one of the below fees.

$8-20 per stackable pallet

$0.60 – $1.50 Per square foot

$0.18 – $0.50 Per cubic foot

Insurance varies based on value and length of storage

Shipping

As these fees are the highest volume, the variation comes in when automation is possible. Some 3PLs will add an implementation fee to get the IT systems integrated but then reduce the on going charges as the labour costs are reduced.

$3-6 Per first unit

$0.25-$2 Per additional unit

$0.50 -$2 Courier Processing

$2-5 Cancellation Fee

$10-50 Rush order

TQS Differentiators

TQS is a sales first logistics company. If we get products to your customers in the most effiecient way, they will buy more. How do we do this with our warehousing services?

• Real time visibility

• SKU optimization

• Product spread report

• Carrier rate shopping

Book a call with us below to learn more about these terms and how they can help your business grow.



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