Work through pricing definitions, measured performance, inventory liability, compliance held in the provider’s own name, integrations and the exit terms — before you compare prices. The questions that matter most are the ones with a number in the answer: the accuracy rate and its formula, the liability limit per pound, the monthly minimum and when it starts, and the cancellation notice window. A good operator answers all eighteen in the first meeting.
First, get your own numbers together
Most bad fulfillment quotes are not dishonest. They are built on an average, because an average is all the brand handed over. Bring twelve months of real history: orders per month including your worst peak, lines per order, units per line, SKU count, case and pallet dimensions and weights, where your customers are, your returns rate, and every channel you sell on.
Pricing and invoicing
1. Will you price my actual order profile, not an industry average?
Ask for the quote to be built against your file, with the arithmetic shown. A provider who will not model your data before quoting is either not set up to, or does not want you comparing the result with anyone else’s. Both are worth knowing. Our guide to fulfillment pricing sets out the usual line items.
2. What exactly counts as an order, a line, a pick and a receipt?
These words are not standardized. At one warehouse a four-unit order of the same SKU is one pick; at another it is four. A receipt might be billed per pallet, per carton, per purchase order or per hour. Get the definitions in writing, then re-run the quote using them. The total often moves by double digits.
3. Is postage passed through at your negotiated rate, or marked up?
Both models exist and both can be fair, but you need to know which you are buying, and should see a sample invoice showing the shipping line. Then ask who absorbs the annual carrier increase. FedEx has announced an average 5.9% general rate increase effective January 4, 2027, with Ground and Home Delivery nearer 6.1% and residential surcharges climbing faster than the headline. A rate sheet that silently reprices every January is not the same product as one that holds.
4. How is storage measured, and on what day?
Pallet, bin, shelf or cubic foot — and whether the count is a month-end snapshot, a daily average or the month’s peak. For a seasonal brand that choice can be most of the storage bill. Ask which your contract uses, and what happens to half-empty pallets.
5. What will be on my first invoice that is not on this quote?
This may be the most useful question here, because it invites the provider to volunteer the fees outside the rate card: onboarding and integration setup, account management, pallet in and out, relabeling, non-conforming receipts, and the hourly rate for anything outside the standard process. A good operator lists them unprompted.
6. Is there a monthly minimum, and when does it start?
Minimums are normal — a warehouse carries fixed cost for your account whether you ship or not. What matters is the size relative to your real volume, and whether it starts on signature or on your first shipped order. Onboarding takes weeks, and paying a minimum while your inventory is still on the water is negotiable.
Performance, and how it is measured
7. What are your accuracy and on-time numbers, and what is the denominator?
A percentage without a formula is marketing. Ask what counts as an error, what counts as on time, which system the number comes from, and what is excluded. Published benchmarks put order accuracy above 99% and on-time shipping above 97% for a competent operation. More on that in what the proper error rate for a 3PL should be.
8. What is the cutoff, in which time zone, and what happens at five minutes past?
“Same-day shipping” means nothing until you know the hour and the time zone. A 9am Pacific cutoff is noon on the East Coast, which changes how you write your own shipping promise. Ask whether a rush is possible and what it costs, and whether there is a cheaper slower tier — plenty of brands pay for speed their customers never notice.
9. What happens when you miss?
Ask whether the service levels sit in the contract with a remedy attached, or in a slide deck. A credit calculated on the affected shipments is usually small; one calculated as a percentage of that month’s fees has teeth. Ask what counts as persistent failure — that language is what lets you leave for cause.
10. Who answers me by name, and what is the escalation path on a Friday in December?
Get a name, a direct line and a second name above it. Ask how many accounts that person carries, and the response commitment during peak, when every brand in the building is escalating at once. The honest answer to “what happens at 4pm on the Friday before Christmas” tells you a lot.
Your inventory, and who pays when it goes wrong
11. What is your inventory accuracy, how often do you count, and do I see the variance report?
Ask for the cycle counting schedule, the accuracy figure with its denominator, and a sample variance report. Then the uncomfortable part: what shrinkage allowance does the contract grant before a discrepancy becomes a claim, and who writes off the difference. Above 99% is the benchmark; the allowance decides who pays for the rest.
12. If my inventory is lost or damaged, what do you actually pay?
Almost every brand assumes the warehouse insures the full value of their goods. Almost none do. Standard warehouse terms limit liability to a small amount per pound — often a quarter to fifty cents — and usually only where the warehouse failed to exercise reasonable care. Get the limit in writing, ask whether higher limits can be bought, then ask your broker about an all-risk cargo policy in your own name.
13. What does receiving cost, and what is your dock-to-stock time?
Receiving fees are easy to miss at quote time and painful once you are importing containers. Ask how receiving is billed, whether palletized and floor-loaded freight are priced differently, what makes a receipt non-conforming, and how long it takes for a received unit to become sellable inventory.
Compliance and category fit
14. Which registrations and certifications do you hold in your own name?
Registration and certification are different things, and providers blur them. An FDA food facility registration is a filing the facility makes, not an inspection it passed. A state food warehouse registration is specific to the address. GFSI schemes such as SQF and BRCGS are audited certifications — a warehouse holds a current certificate or does not. Ask which legal entity holds each, and to see the record rather than a logo.
15. What in my category will you not touch?
This gets you further than asking what they can do. Aerosols and other limited-quantity hazmat, lithium batteries, alcohol, controlled temperature, lot capture or expiration dating on outbound shipments, retail-compliant EDI and routing guide work — ask directly, and ask what is standard versus a paid add-on. If you handle a food on the FDA’s traceability list, ask whether their records will support what the agency requires from July 20, 2028. A provider who says yes to everything is answering a sales question, not an operations one.
Systems and data
16. What integrates on day one, who builds it, and who pays?
List every channel you sell on now and the one you expect to add next year, and get each confirmed individually: storefront, marketplaces, retail EDI, your ERP, your returns portal. Ask whether each is native, through middleware, or a custom build — and if custom, who owns it, who maintains it, and the hourly rate when it breaks.
17. Whose data is it, and what do I get out if I leave?
Ask who owns your transaction and customer data, how you export it, whether you get SKU-level history or a summary, and what happens to it after termination — how long it is retained, and whether you get written confirmation of destruction.
The contract, and the exit
18. What does it take to leave?
Read the exit clause before the pricing page. You want the initial term, whether it renews automatically, and how wide the cancellation notice window is — an auto-renewal with a ninety-day window is a date in your calendar, not a decision you make when you are unhappy. Then the operational half: do they keep shipping at current rates during a transition, what are the removal and loadout charges, and how fast can inventory be counted and released.
Three answers that should stop the conversation
- “We can’t give you a number for that.” Accuracy, on-time rate, liability limit, notice period — all four are numbers. A provider who will not say them out loud will not report them later either.
- “Yes, we do that too” — to every question, including the ones that conflict. Ambient and frozen, hazmat and food, same-day DTC and full retail compliance, all at the quoted price. Ask which is running today, for how many brands.
- “Don’t worry about the contract, we’re flexible.” Flexibility is lovely until month eight. The contract is what you have then.
What we say when a brand runs this list past us
We would rather answer all eighteen in the first meeting than win an account and lose it in the sixth month. Our reported order error rate runs under 1% and we will show you the calculation. The same-day cutoff is 9:00am Pacific with rush available, plus a discounted three-day program for brands that do not need same-day. Palletized receiving is free, not a billed line item; floor-loaded freight carries an hourly rate to palletize it for movement and storage. Inventory insurance is $2,500 per pallet as standard, with higher limits available for an additional fee. There is a rate card; we do not publish it, but we will build a quote against your order file and walk you through every line. No peak-season volume commitment is required, and we have shipped 50,000 orders in a single day on a special project out of the 38,000 square foot Thousand Oaks facility.
And the honest part. The facility is ambient only, so if you need refrigerated or frozen storage we are not your warehouse — we can refer you out, as we can for alcohol and for GFSI-scheme programs such as SQF or BRCGS, which we do not hold. We are not the importer of record. Supplement lot capture on outbound shipments is a paid add-on, not a default. And if what you want is the lowest possible per-order rate with no handholding, there are providers built for that.
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