Are You Using the Right Type of eCommerce Distribution Center for Your Business?

Key Takeaways

• Outgrowing your current fulfillment setup can slow growth, increase costs, and frustrate customers.
• The right eCommerce distribution center model balances speed, scalability, and visibility.
• Options include in-house, warehousing, 3PL, and hybrid fulfillment, each with unique advantages.
• Use performance data and growth goals to guide your next move.
  Not sure which model fits? Take our quick assessment to find out.

When Your Current Distribution Center Stops Fitting Your Business

Your eCommerce brand is booming. Orders are up, but so are headaches. Inventory feels maxed out. Shipments are delayed. Your operations team is juggling fires instead of planning for growth.

When demand surges and your fulfillment system can’t keep up, it’s a clear signal to pause and ask: Is your current distribution model still the right fit for your business?

In this blog, we’ll explore what happens when your logistics setup outgrows its usefulness, how supply chain management in eCommerce depends on the right infrastructure, and what options you have to scale effectively.

What Happens When You Outgrow Your Fulfillment Setup?

As your business grows, your fulfillment challenges evolve. The same setup that once felt “just right” may now be holding you back. Common signs include:

Backlogs during peak seasons or flash sales.

• Backlogs during peak seasons or flash sales.
• Unclear stock levels leading to overselling or stockouts.
• More shipping errors or damaged goods.
• Manual processes that can’t keep up with new SKUs or sales channels.

If these sound familiar, it’s time to reevaluate your logistics, starting with the heart of your operation: your distribution center.

What Types of Distribution Centers Are Available for eCommerce?

When you start exploring your options, you’ll typically find four main fulfillment models, each with its own strengths and tradeoffs.

1. Warehousing

When orders lag in picking, packing, or shipping, it doesn’t just mean a late delivery — Warehousing is best for businesses focused on long-term storage of inventory, not high-turnover shipping.

✅ Pros: Cost-effective for bulk storage, simpler setup
❌ Cons: Limited fulfillment speed and visibility

2. In-House Distribution

This is ideal for companies that want full control and have the capital to invest.

✅ Pros: Direct oversight, branded experience
❌ Cons: High costs for labor, tech, and scalability

3. 3PL Fulfillment Centers

These are best for growing eCommerce brands ready to scale without the infrastructure burden.

✅ Pros: Expertise, automation, scalability, lower overhead
❌ Cons: Less direct control over day-to-day operations

4. Hybrid Approach

This method combines in-house oversight with outsourced support from a 3PL distribution partner like Materialogic.

✅ Pros: Flexibility to adapt to demand changes
❌ Cons: Requires clear communication and system integration

Each model impacts your eCommerce supply chain management differently. The key is identifying what aligns best with your growth goals, order volume, and customer expectations.

How Can Data Help You Choose the Right Model?

If you’re unsure whether to switch from in-house fulfillment to a 3PL eCommerce distribution center, let data guide your decision.

Ask yourself:

• Are shipping delays becoming more common?
• Do I lack visibility into inventory or carrier performance?
• Are fulfillment costs rising faster than sales?
• Is our tech stack too limited to scale efficiently?

If you answered “yes” to any of these, your system may be limiting your profitability.

Use KPIs like order accuracy rate, on-time delivery rate, and cost per order to evaluate your logistics performance. Then, identify your priorities and balance need with practicality and cost.

Not Sure What Kind of Warehouse Your Business Really Needs?

Take our quick assessment to get a personalized recommendation for your operations.

The Right Fit Can Change Everything

The wrong fulfillment setup doesn’t just slow you down. It can directly impact customer satisfaction, margins, and your ability to grow.

Finding the right eCommerce distribution center model ensures your logistics are a competitive advantage, not a liability.

At Materialogic, we help eCommerce brands streamline supply chain management with data-driven fulfillment, real-time inventory visibility, and flexible distribution models designed to scale.

If you’re ready to level up your logistics, start by exploring our custom fulfillment solutions or talk to an expert today.

FAQ: Choosing the Right eCommerce Distribution Center

1. What’s the biggest difference between a warehouse and an eCommerce distribution center?

A warehouse focuses on storing goods; a distribution center focuses on moving them efficiently through the supply chain with real-time visibility and faster fulfillment.

2. How do 3PL fulfillment centers improve scalability?

They use automation, flexible storage, and shared labor models to help you handle growth without expanding your own facilities.

3. When should I switch from in-house to outsourced fulfillment?

If order volume spikes regularly, fulfillment costs are climbing, or visibility is limited, it’s time to consider a 3PL.

4. Can I use a hybrid fulfillment model?

Yes. Many businesses keep certain SKUs in-house while outsourcing overflow or specialty items to a 3PL, giving them the best of both worlds.