This article is a contribution from Brooks Golba, VP, Fulfillment & Logistics Solutions at Qualfon.
In the fast-paced world of ecommerce, speed is crucial, but flexibility is equally important. Consider a popular home gadget that sells out rapidly during a holiday promotion alongside a bulky, niche item that sells steadily but at a slower pace. Treating both products the same way in your fulfillment strategy can either erode profit margins or frustrate customers. This is where a hybrid fulfillment model comes into play—a strategy that combines multiple fulfillment methods, including Fulfillment by Amazon (FBA), Fulfillment by Merchant (FBM)/Seller-Fulfilled Prime (SFP), and third-party logistics (3PL) services. This article explores how a hybrid model is structured and the benefits it offers.
To illustrate the advantages of a hybrid model, let’s consider a hypothetical mid-sized apparel brand.
- Their best-selling T-shirts are fulfilled through FBA, allowing for speed and Prime visibility.
- The brand’s premium winter coats, which are bulkier and slower-moving, are shipped through a 3PL partner to reduce storage and fulfillment costs.
- Their seasonal items, such as holiday-themed sweaters, are managed via FBM, enabling quick adaptability to demand spikes.
This combination keeps fulfillment costs in check, avoids long-term storage fees, and maintains healthy margins across all product types.
Different Methods Are Used For Different Reasons
For high-volume products, using FBA is often the best choice. FBA is a powerhouse for fast-selling items due to its Prime-speed shipping and customer trust, which can significantly boost conversion rates. However, the preparatory work required to comply with Amazon’s FBA program can be considerable. With Amazon’s recent announcement ending its prep services, brands must either handle this themselves or find a partner experienced in Amazon prep.
Not every product benefits from FBA. Bulky items, slow movers, and products with high average order values (AOV) can quickly eat into profits due to the storage and fulfillment fees associated with FBA. Alternatively, FBM or SFP allows brands to reduce costs and protect their margins while still offering reliable delivery.
Third-party logistics providers (3PLs) are game changers in a hybrid model. They enable brands to scale quickly, manage seasonal spikes, and reduce dependency on Amazon’s fulfillment network. Adding a 3PL into the mix also means reduced shipping fees, as long as the 3PL has strong carrier relationships. For example, a premium kitchenware brand may use a 3PL to handle oversized cookware while utilizing FBA for smaller, high-volume items, keeping costs controlled and ensuring fast delivery for high-demand SKUs.
A hybrid model also helps brands:
- Mitigate Risk and Storage Costs: Relying exclusively on FBA carries risks, such as induction delays, fluctuating inventory limits, and long-term storage fees, which can create unexpected bottlenecks. A hybrid approach, incorporating FBM or a 3PL, helps brands avoid over-reliance on a single fulfillment method, manage inventory effectively, and protect margins across all products.
- Build Agility to Adapt Quickly: Amazon frequently updates its policies, fees, and operational guidelines. With a hybrid model, brands can pivot quickly, moving products between FBA, FBM, and 3PL networks to optimize costs, avoid disruptions, and maintain customer satisfaction.
- Test New Marketplaces Without Duplicating Infrastructure: Expanding into new marketplaces, like Walmart, Target+, Shopify, or niche regional platforms, can be daunting. Many brands feel the necessity to replicate warehouses and fulfillment operations for each channel, which is both expensive and operationally complex. A 3PL simplifies the testing process. By centralizing inventory, order processing, and shipping, brands benefit from reduced shipping costs and can utilize the same inventory across multiple marketplaces without needing to establish separate distribution networks. This allows them to scale up or down quickly based on demand and maintain consistent delivery standards across platforms. Brands can also test product market fit cost-effectively, redirecting slow-moving or seasonal inventory without being tied to long-term storage or multiple contracts.
For instance, a mid-sized home goods brand that wanted to test the Walmart Marketplace while continuing sales on Amazon could use a 3PL to fulfill Walmart orders directly from existing inventory, avoiding the need for a separate warehouse. This approach allows them to experiment with minimal upfront investment and make data-driven decisions before fully committing.
Conclusion
A hybrid fulfillment strategy isn’t just a logistical choice; it’s a strategy for growth and risk management. By aligning fulfillment methods, including FBA, FBM/SFP, and 3PL partners, with product type, sales velocity, and business goals, brands can maximize speed, reduce costs, maintain flexibility, and scale efficiently. The smartest brands understand that success comes not from committing to a single fulfillment method, but from knowing when and how to combine methods effectively, as well as recognizing what a reliable and experienced 3PL can offer.
About Qualfon
With 40 years of experience in inventory management, kitting, fulfillment, and shipping, along with two-day nationwide delivery to Amazon Fulfillment Centers, Qualfon’s FBA support services are dedicated to assisting brands in optimizing their fulfillment strategies.
Are you considering partnering with a 3PL, or do you need advice on how to structure your fulfillment strategy? Talk to a Qualfon fulfillment specialist today—contact sales@qualfon.com.
