3PL vs own warehouse operations: Which is right for your business?
Last updated: 5 Nov 2025
Should you outsource to a 3PL or run your own warehouse? This guide breaks down the trade-offs so you can make the right call for your e-commerce business.
Key takeaways
- 3PLs are cost-effective for scaling brands, offering flexible pricing, faster delivery, and access to global infrastructure without upfront investment
- Running your own warehouse gives you complete control over operations, branding, and customer experience but requires higher upfront capital and expertise
- Geography matters too. 3PLs can position inventory closer to customers worldwide, while an in-house setup usually limits reach
- The right choice depends on your growth stage, cash flow, and whether flexibility or full control matters more to your business strategy
If you’re importing products or running an e-commerce store in AU/NZ, you already know the pain: juggling suppliers in China, marketplaces across borders, payments in multiple currencies, and rising overheads.
At some point, every business finds themselves dealing with the same dilemma: Do you hand off logistics to a third party logistics partner (3PL) or bite the bullet and run your own warehouse?
It’s not a one-size-fits-all-business decision, or even an easy one. In this blog, we break down the real trade-offs of 3PL vs your own warehouse operations.
And while you figure that out, WorldFirst makes at least one part simple: paying suppliers, shipping agents, and marketing agencies as well as receiving from marketplaces in multiple currencies–all through a single account.
Table of Contents
What is 3PL?
A third-party logistics provider (3PL) is an outsourced partner that can take over some or all parts of your logistics operations. Most 3PLs have their own global warehouse networks and transportation systems, which you can tap into to streamline import and shipping processes.
Here’s everything 3PLs can help you manage:
Most 3PL providers handle:
- Warehousing: Storing your products across multiple, strategically located facilities
- Inventory management: Monitoring stock levels in real time so you always know what’s available
- Fulfilment: Picking, packing, and preparing orders for shipment
- Freight coordination: Moving goods across borders or domestically by truck, air, or sea.
- Last mile delivery: Delivering products directly to your customers
- Technology integration: Offering software that connects directly to your e-commerce store or ERP for smooth order processing and tracking
Here’s how the process usually works: Your inventory arrives at a 3PL’s warehouse and is organised by Stock Keeping Unit (SKU). When a customer places an order, the 3PL’s system syncs with your online store, generates a picking list, and the warehouse team packs and labels the order. The package is then handed off to a carrier for delivery, and tracking details flow back into your store or order management system.
Why businesses choose 3PL: Scaling businesses choose 3PL to access faster delivery networks, an already built infrastructure, and easy fulfilment management, without investing heavily in warehouses or staff.
What are in-house warehouse operations?
In-house warehousing keeps logistics under your direct control. So, you set up or lease a warehouse, hire staff, and manage the entire order fulfilment process internally.
The model is more useful for large retailers, established e-commerce brands, or businesses with high SKU counts and large order volumes.
While it requires significant upfront investment, in-house operations provide greater control over fulfilment speed, packaging quality, and customer experience.
Of course, there are some downsides as well. As order volumes fluctuate, in-house teams may struggle with underutilised space during slow periods or capacity crunches during peak seasons.
Why businesses choose their own warehouses: It’s mostly preferred by businesses that want to scale their operations at their own pace and get full control over inventory, packaging, and fulfillment speed.
Pros and cons of 3PL vs own warehouse
| Pros | Cons | |
|---|---|---|
| 3PL | No upfront capital investment Faster scalability Expertise in shipping and fulfilment Access to global infrastructure |
Less control over operations Ongoing fees can add up Dependent on third-party performance |
| Own warehouse | Full control over operations and branding Potential long-term cost savings (at scale) Direct customer experience management |
High upfront investment Complex to scale quickly Requires staff, systems, and expertise |
3PL vs own Warehouse operations: Key factors to consider
When choosing between a third-party logistics provider (3PL) and operating their own warehouse, e-commerce brands and importers must weigh several factors that directly impact costs, growth, and customer experience.
Cost
3PLs typically operate on a variable cost model where you pay for the storage, fulfilment, and shipping that you use. The variable pricing makes it super easy for new businesses that are still scaling or may have seasonal peaks.
In contrast, running your own warehouse involves fixed costs such as rent, staff salaries, utilities, and systems. So even if your warehouse is half empty or your business is going through slow periods, you will have to fork out fixed costs required to maintain and run the warehouse. Yes, it can be more cost-effective at scale but requires significant upfront investment.
Scalability
With 3PL, you can quickly ramp operations up or down to match seasonal peaks or market changes. An in-house warehouse is harder to scale quickly and may lead to underutilised space during off-peak periods.
Control
Managing your own warehouse gives full oversight of inventory, packaging, and fulfilment speeds. A 3PL may limit branding opportunities or dictate certain processes, leaving you with less control.
Expertise and technology integration
3PLs bring industry expertise and often provide advanced warehouse management systems (WMS), integrations, and data-driven insights. To match this in-house, businesses must invest in software, hire skilled staff, and continuously upgrade systems.
Geography
Many 3PLs operate multiple warehouses globally, enabling faster delivery by positioning inventory closer to customers. An in-house facility is typically limited to one or two locations, which may result in longer shipping times for distant customers.
Ultimately, the decision depends on where your business is in its growth journey, the importance of flexibility versus control, and your ability to invest in long-term infrastructure.
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Which option is right for your business?
The right model depends on your growth stage, capital availability, and how important control and brand experience are to your customer promise.
- Choose 3PL if: you’re a growing brand with fluctuating demand, limited capital for infrastructure, or you want to stay lean and focus on sales and marketing rather than logistics.
- Choose your own warehouse operations if: you have predictable sales volumes, a strong need for brand control, and the financial capacity to invest in long-term infrastructure.
How WorldFirst supports your supply chain
WorldFirst helps AU and NZ e-commerce brands to streamline payments to logistics partners (3PL, warehouses, freight forwarders), ensuring goods never get held back due to delayed payments.
With a World Account you can:
- Pay overseas suppliers in local currencies to maintain strong partnerships and avoid unnecessary fees
- Receive funds from e-commerce platforms (Amazon, Etsy, Shopify) in 15+ currencies directly into your WorldFirst account
- Hold and manage multiple currencies without forced conversions
- Make fast, secure same-day international transfers to suppliers or 3PL providers abroad
- Access competitive FX rates to protect margins and reduce exposure to currency volatility
- Improve cash flow visibility and control with one centralised account.
- Get dedicated support for businesses scaling their cross-border operations
Open your WorldFirst account today and take the complexity out of international payments.
Disclaimer: The information contained is general only and largely our views. Before acting on the information you should consider whether it is appropriate for you, in light of your objectives, financial situation or needs. Although information has been obtained from and is based upon multiple sources the author believes to be reliable, we do not guarantee its accuracy and it may be incomplete or condensed. All opinions, estimates, mentioned products/services and referenced material constitute the author’s own judgement as of the date of the briefing and are subject to change without notice. WorldFirst shall not be responsible for any losses or damages arising from your reliance of such information.
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