When does doing your own packaging become more expensive than outsourcing it?

The comparison between doing it yourself and outsourcing almost always comes out skewed, because one side has an invoice and the other doesn’t. Packing it yourself feels free because you don’t bill yourself for your own time. As soon as you factor that in, the picture changes.

What You're Already Paying Without Realizing It

Your hours or those of your staff, the space where you store your inventory, packaging materials, your shipping costs, and the time spent handling returns. These expenses aren’t listed together anywhere, which is why doing it yourself seems cheaper than it actually is.

It's not just about costs

The hours spent packing boxes don’t go toward purchasing, marketing, or your product lineup. For a growing online store, that’s usually the most expensive expense, even though it doesn’t appear on any invoice.

The tipping point is not a number

There’s no magic order volume above which outsourcing becomes worthwhile, and there’s no set answer to the question of whether your online store is big enough. It depends on the type of products you sell, your return rate, your peak periods, and how much your time is worth. An online store with few but complex orders may reach the break-even point sooner than one with many simple orders.

Peaks carry the most weight

Most online stores can handle an average week just fine on their own. It’s the weeks around a promotion or the end of the year when things get hectic. So don’t base your calculations on your average—base them on your busiest week.

What Won't Change

Your purchasing, your margins, and your product lineup remain under your control. Outsourcing changes who performs the tasks, not who makes the decisions. That’s also why the comparison is primarily about time and capacity, not about control.

Let's do the math honestly for once

Compare your own hours, space, materials, and shipping costs with a proposal, as described in “How to Compare a Fulfillment Proposal with Your Own Operations.” Only then will you be comparing like with like. Without that exercise, you’re comparing an invoice to a gut feeling.

Request a quote based on your own figures

A comparison is only useful if it's based on your order volume, your products, and your returns. That's what a request for a quote provides, and all it takes is a conversation.

What exactly the costs consist of

When it comes to outsourcing, the price involves more than just a per-package fee. It includes charges for storage, receiving, and fulfillment itself, and these costs are structured differently for many small orders than for a few large ones. “What Determines Fulfillment Costs” explains what these components are, so you’ll know what to look for when you receive a proposal.

Plan for your busiest period

Your average week doesn't tell the whole story. It's during the weeks surrounding a promotion or the end of the year that packing in-house becomes more expensive than outsourcing, because you have to bring in extra staff you don't need the rest of the year.