A comparison of costs, efficiency and scalability for companies wishing to establish their own warehouse
As the economic engine of the European Union, Germany offers significant opportunities in e-commerce. However, increasing competition, rising consumer expectations, and the complexity of logistics have led companies to seek alternative business models. In this context, fulfillment services have been adopted as a strategic solution by established companies in Germany in recent years.
1. The Operational Burden of Personnel Management:
In Germany, hiring personnel for warehousing processes is not limited to wage costs alone.
This also includes legal obligations such as social security premiums, leave tracking, shift planning, and occupational health and safety.
As of 2023, the average hourly labor cost in the logistics sector is €22.61.
This makes it difficult for small and medium-sized businesses to establish a stable logistics operation.
2. Fixed Costs and Investment Requirements
: Establishing your own warehouse involves not only the cost of warehouse rental but also the investment in equipment.
The investment required for barcoding systems, security infrastructure, fire prevention systems, and automation solutions ranges from €25,000 to €50,000.
Furthermore, the operational risks that arise if the warehouse remains closed should not be overlooked.
3. Cost Differences in Logistics Agreements
: Individual shipper agreements with cargo companies often result in significantly higher unit shipping costs.
However, fulfillment centers, thanks to their high volume of shipments, access special pricing with carriers.
This can provide a 20–30% cost advantage per shipment for the average business.
Furthermore, the fixed pickup times granted by logistics companies to fulfillment centers ensure consistent delivery times.
4. Operational Continuity and Transparency:
One of the most important features of fulfillment centers is their ability to operate uninterrupted throughout the business day.
While your own warehouse carries the risk of closure due to illness, leave, or unexpected circumstances, with outsourced operations, this burden is assumed by the service provider.
Furthermore, software-based tracking systems allow for real-time monitoring of inventory, ordering, and return processes.
5. Strategic Sourcing
: Warehouse management falls outside the core business of many companies.
For companies that want to focus on high-value-added areas like product research, marketing, and supply chain development, fulfillment offers the opportunity to outsource operational burdens.
“Outsourcing logistics operations is a factor that increases the strategic capacity of companies.”
– European Logistics Association, 2022 Annual Report2
Conclusion:
The fulfillment model offers significant advantages in terms of efficiency, scalability, and cost management not only for companies wishing to trade outside Germany but also for businesses based in Germany.
Changing e-commerce dynamics are driving companies toward flexible infrastructures rather than fixed structures, and in this context, fulfillment solutions emerge as not just a logistics service but also a growth strategy.
References:
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Footnotes
Statista – Labor costs in logistics industry, Germany 2023 ↩
European Logistics Association – Annual Report 2022, www.elalog.eu ↩