Over the years, the way firms sell products to consumers has changed radically. Increasingly, people are choosing to buy products from the web rather than from the High Street. This means that the way distribution networks operate has changed drastically. In the past, distribution was a relatively simple process for retailers. They mostly sent pallets, racks or large boxes of goods from their warehouse to their shops. Now, because more customers want goods from websites, there are two other layers of activity to manage.

Most firms are now distributing a significant percentage of their products as individual items. They are sending them direct to their customers from their warehouses. This means firms have had to alter their warehouse layout, invest in new machinery and change the way they pick. In addition, each item needs to be packaged, so that has meant adding packing stations and staff. Firms also have to deliver it to the door, which means hiring couriers or using the regular post.

Third party fullfilment

Getting order fulfilment right is much more difficult than it once was. For this reason, many firms are turning to third party fulfilment centres to deliver their products. In some cases, they are using these third party firms to distribute products to their stores as well as to individual customers.

Using a third party order fulfilment centre makes the distribution process much easier and more reliable. It is also a far more flexible way to distribute products. In addition, economies of scale mean that a third part fulfilment firm can usually distribute goods at a lower price.