Fulfillment Center vs Distribution Center: What’s the Difference?

How do fulfillment centers work? And do you need a fulfillment center, or is it perhaps the case that your organization would be best served by working with a distribution center?

At B&C Logistics, our third-party logistics experts are standing by to help you with all your supply chain requirements, and this includes becoming more familiar with fulfillment centers and distribution centers, in terms of how they can help you grow your business in scope and size.

What is a Fulfillment Center?

Are you and your colleagues wondering about whether you’ll need to work with a fulfillment center vs a distribution center? In a fulfillment center, professionals work to make sure your orders are carried out and sent to customers per your exact requirements.

Your items will arrive at the fulfillment center in a container or on a pallet, and employees then position them for storage until it’s time to assemble and package the products for delivery to your customers. The facilities are kept safe and secure, for your peace of mind as orders move through the supply chain.

You can monitor the progress of items within the dashboard of your fulfillment center’s software. As customers send in their orders, the system will verify the details, and then workers (often with the help of automated systems) will pick up each item in the most efficient manner, for secure packing and labeling, so they can then be distributed.

What is a Distribution Center?

Distribution centers play a vital role in the global supply chain. Organizations rely on distribution centers as secure places to keep products so the workers can efficiently distribute them to their B2B or D2C customers. In some cases, you will use a distribution center as a hub to transition from one form of transport to another, such as items coming from an international flight to then move out via trucks or trains.

In a sense, distribution centers can operate as a warehouse because products stay there before their next movement through the supply chain line. Retail grocery chains are major users of distribution centers as they need a nearby distribution point to ensure they keep the local stores stocked with items at all times.

What is a Warehouse?

As the name suggests, a warehouse is a facility designed for the secure storage of items by organizations. It serves the purpose of storing products for extended periods, such as excess seasonal inventory expected to be moved eventually, or as temporary holding for frequent distribution. It’s important to note that a warehouse is primarily for storage and doesn’t involve the direct movement of products to consumers, distinguishing it from a distribution center where more active goods distribution takes place.

It’s important to select your warehouse carefully, such as if you need environmental controls for items such as candies or other food products, or perishable items such as pharmaceuticals or vitamins.

Fulfillment Center vs Distribution Center

You may have heard experts use the terms “fulfillment center” and “distribution center,” while not being certain about what the distinction is.

Simply put, fulfillment centers operate as a unique type of third-party logistics warehouse. They receive items, process them, and manage order fulfillment.

When utilizing a fulfillment center, you have the option to either send the products to the fulfillment center personally or coordinate with your manufacturer to ship the products directly to the fulfillment center. On the other hand, a distribution center is most often used to receive products, briefly store them, and then, as orders come in, distribute the items to customers.

How do Fulfillment Centers Work?

After verifying the list against the contents that need to go into a package, the picker will put items inside a box, fill it with infill (for safety during shipping), and apply a shipping label. At this point, the items are poised for shipping out of the facility, such as via a carrier like UPS or FedEx.

Be aware that a fulfillment center serves as a major component of third-party logistics or 3PL. A single 3PL firm might work with one center, or an entire chain of fulfillment warehouses in the U.S. or on an international basis. So fulfillment centers are a vital part of 3PL.

Regardless of whether your business requires retail fulfillment services or is more focused on e-commerce fulfillment, understanding in detail how fulfillment centers work is essential. 

There are many moving parts to keep track of when you have a complex supply chain moving goods from your business to eager customers, whether you’re involved with D2C or B2B operations. A major question is whether you will work with a fulfillment center vs a distribution center.

When you have more perspective about your organization’s requirements in terms of fulfillment centers or distribution centers, your next step is to partner with 3PL experts with years of experience in the industry.

This is where B&C Logistics can assist. We have multiple warehouse locations to better serve our customers. And we’re the go-to solution provider for businesses that are looking for these centers and are in need of help with such crucial services as logistics, warehousing, distribution, and fulfillment.

To request a quote, reach out to our experts at B&C Logistics. We’re here to assist you!