ShipBob vs
Deliverr
ShipBob or Deliverr: In-Depth Review
First, do I need a 3PL?
Having a rock-solid order fulfillment strategy is crucial for DTC companies nowadays. Customers want fast and free shipping, which can be tough to accomplish when you’re managing it all in-house. When you’re trying to scale your business, you don’t have the time or bandwidth to run a warehouse at the same time. Fortunately, there are a few options that can help you provide a positive shipping experience for your loyal customers.
To begin, you may actually want to consider shipping from home to keep your costs down. It can make sense financially for smaller businesses or startups, and allows you to test and pivot your packaging and fulfillment on the fly. If this is you, we’ve created an awesome guide to help you set up in-house fulfillment like a pro.
For many brands, the preferred choice is to take advantage of a fulfillment center that will handle the pick, pack, and ship process for you. A 3PL (third-party logistics) partner will put more time back in your day to spend on growing your company instead of packing boxes.
Note: If you are unsure if now is the right time for a 3PL, we made a guide (and free quiz) to walk you through that decision.
Who are ShipBob and Deliverr?
Once you decide you need a 3PL, now comes the hard part of vetting potential partners. Out of thousands of fulfillment centers, ShipBob and Deliverr are two of the largest. They have raised almost $900 million between them over the past few years and grown crazy fast.
Both ShipBob and Deliverr outsource at least some of their fulfillment to independent warehouses in their network in what is known as a 4PL model. ShipBob still manages some of their own warehouses, but relies heavily on their SFN (ShipBob Fulfillment Network), while Deliverr operates by contracting work out to other warehouses.
More often than not, companies that expand too quickly or contract their operations out to other providers will fall short in the service department to appease investors looking for rapid growth over all else. In this comprehensive breakdown, we’ll give to a full (and unsponsored) review of ShipBob and Deliverr to help you figure out if they may be a good fit or if a more service-focused 3PL like OTW Shipping is a better option.
Overview
Although most brands focus primarily on price, choosing a 3PL should consider a few other factors like customer support and location. After all, you truly do get what you pay for in fulfillment. Ideally, your 3PL should be close to the majority of your customers for lower shipping costs and faster ship speeds.
Many brands assume they need multiple locations, but unless you are doing pretty significant volume it can actually cost more to split inventory into multiple inbound shipments. A million locations sounds great, but for most brands you will need just 1, and bigger brands will need 2-4 at most.
Fulfilling from just 2 locations can extend your 2-day ground shipping coverage to almost 100% of the US. The decision to manage split inventory across multiple warehouses is expensive and complex, so don’t ever pick a 3PL just because they have a multitude of locations. In addition, 3PLs with multiple locations won’t always split your inventory across multiple warehouses until you are doing the volume to justify it anyways.
ShipBob: Pros and Cons
As an early-stage brand, ShipBob is often seen as a solid option. With an eager sales team, a modern website, and a unique fee structure. Free pick and pack seems like an offer you can’t refuse! So, why isn’t ShipBob the go to 3PL for everyone?
Pros
Cons
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Many warehouse locations, including international locations
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Easy to use interface
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Good list of integrations with eCommerce tools
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No order minimum
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Straightforward pick & pack pricing
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No guaranteed same-day shipping can mean delays in order processing
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No liability for picking errors
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Hidden fees
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Can’t view your fulfillment pricing without creating an account
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Lack of support for brands < 400 orders/mo
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High storage and implementation fees
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B2B fulfillment add-ons are expensive
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Do not own their warehouses within the SFN
Deliverr: Pros and Cons
Deliverr is oftentimes the next 3PL that comes to mind. With low advertised pick and pack rates and promises of 2-day delivery badges, brands looking for a fulfillment center might be easily drawn in.
Pros
Cons
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Multiple warehouse locations
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Simplified pick & pack rates
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Easily navigable interface
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Reasonable storage fees and free receiving
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2-day shipping badges
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2-day shipping is advertised, but not guaranteed
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Limited services (no returns, FBA shipments, kitting, custom packaging, inserts, or B2B)
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Additional fees require an account to view
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Relatively small number of integrations
Note: If you do need any of the above services in additional to DTC fulfillment, click here.
OTW Shipping: Pros and Cons
OTW Shipping is a stark contrast to ShipBob and Deliverr. We own our warehouses and we have no investment backing for growth. We focus entirely on providing the best service with transparent rates and communication.
Pros
Cons
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Great support: 3 dedicated contacts for the warehouse, account info, and technical issues
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Guaranteed same-day shipping
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Transparent rates, no hidden fees
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No minimums
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Many integrations
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Reasonable storage fees and free receiving
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No international locations
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Basic reporting
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Does not use FedEx
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No apparel or cold-storage
Fulfillment Services
Read closely and consider all fees you could be hit with when using a fulfilllment center.
ShipBob: Fulfillment Services
There are a couple big things that stand out regarding ShipBob's services offered.
1. Implementation fees as high as $1,000.
ShipBob offers a Startup Growth Plan for small businesses putting out less than 400 orders/mo, but you will not be provided an account rep, and you can only communicate with support during limited office hours, so you’re on your own for the most part.
2. Hourly receiving fees.
For the first two hours you only pay $25, but it is $45/man/hr after that. Since it is priced at an hourly rate, it could be hard to know just how long it could take them to process replenishments so it’s a bit of a black box as to what you might eventually pay. Across the industry, 3PLs normally charge for receiving by the carton/pallet/container.
3. High storage fees.
For those of you with bigger products, be ready to grab your checkbooks. ShipBob has some very expensive storage rates compared to the rest of the fulfillment industry (up to 11.8x more expensive per square foot than OTW Shipping and 8.7x more expensive than Deliverr’s rates during January-September).
Deliverr: Fulfillment Services
The main things to know about Deliverr's services:
1. 2-day shipping badges.
Deliverr looks to make their name on offering badges on certain selling platforms which they claim increase conversion rates. The idea is similar to Amazon Prime badges, but unlike Prime, 2-day shipping is not guaranteed so there is always the chance that you will disappoint customers if you promised 2-day shipping.
2. Lack of additional services offered.
Low pick & pack rates from Deliverr come with the trade-off of limited services. If you need most anything other than basic DTC fulfillment (even just returns), Deliverr won’t be able to help.
3.Expensive peak and long-term storage fees.
While Deliverr charges storage by product volume and storage fees from January through September aren’t outrageous, rates get over 3x more expensive during the holiday season. On top of that, Deliverr charges long term storage rates that are over 9x more expensive than off-peak standard storage rates.
OTW Shipping: Fulfillment Services
Here some things to look at for OTW Shipping’s services:
1. No account or implementation fees.
For young businesses, avoiding implementation and monthly account fees can save you thousands and help cash flow since you only pay when you ship. Note that a pick & pack minimum could be added on a case-by-case basis.
2. Affordable pick and pack fees.
Compared to ShipBob, OTW Shipping offers more reasonable pick & pack fees that can help you rack up savings.
3. Free receiving.
Unlike Shipbob and Deliverr, OTW Shipping provides free receiving as well as a verified inventory program. Especially for those with high pallet counts, this can represent a huge reduction in costs.
Fulfillment Pricing
With every 3PL, there are slightly different structures for pick & pack pricing and kitting fees.
Note: If you need help comparing quotes from different 3PLs, use our free template!
Pick & Pack Fees
These will get paid on every order so pay close attention.
ShipBob: Pick & Pack
ShipBob has a different pick & pack model from most 3PLs. They bundle your fulfillment fees up to 4 units into one number with your shipping rates. For brands who often have many picks per order, this could provide an advantage. If you want to see your actual rates though, you’ll have to register for an account which can be annoying if you are just looking for a quote for now.
Deliverr: Pick & Pack
Deliverr utilizes a flat-fee for fulfillment that varies based on how many units are in the order. Similar to ShipBob, you’ll have to sign up to view their full rate charts and international shipping rates which is a pain when you’re just looking for a quote. However, if you just want the specific cost for one scenario, they have a rate calculator you can use for domestic shipments. There are some additional charges if your product requires any time of protection (Kraft paper, bubble wrap, etc.) that are only viewable after creating an account as well.
OTW Shipping: Pick & Pack
OTW Shipping doesn’t require you to create an account to view their pick & pack rates. This transparent strategy is a bit more welcoming to those just beginning their search. With a more traditional rate structure, companies with a more standard number of picks can take advantage here. And businesses who are growing rapidly can utilize the tiered pricing to get lower rates automatically as your volume increases.
Regardless, for all of these fulfillment options, we recommend reaching out to them to get a custom quote which could provide you the opportunity for some improved rates.
Kitting Fees
Every client's kitting needs are different, so naturally pricing models will differ.
ShipBob: Kitting
ShipBob actually has the easiest-to-calculate kitting pricing with every action priced out.
How to calculate: $5.00 for training and work station setup + kitting fees
Picking Fee: $0.07 per SKU
Construct my box/packaging: $0.56
Close my box/packaging: $0.04
Place item in box/packaging: $0.10
Pack item in ShipBob packaging: $0.15
Affix a pre-provided sticker/label/barcode: $0.21
Affix a ShipBob printed sticker: $0.26
Exact positioning requested for sticker/label/barcode: $0.07
Remove item from package: $0.21
Remove packaging or an insert: $0.28
Add my dunnage to the kit: $0.11
Add ShipBob paper dunnage: $0.11
Construct my box/divider insert: $0.28
Wrap my item: $0.28
Seal an item shut with tape/sticker: $0.08
Perform inspection of an item: $0.21
Change Item SKU to kit SKU: $0.02
Deliverr: Kitting
Deliverr does not offer kitting, so you’re out of luck here.
OTW Shipping: Kitting
OTW Shipping uses their special project rate to determine kitting fees. Every kitting project is going to be different, so having customized pricing can make sure you get the best deal. If you'd like to obtain a quote for a kit, click here.
Service Level Agreements
When looking for a 3PL, make sure to ask them about their service level agreements. Anyone can say they offer something like 2-day shipping, but you need to know they’ll follow through on those claims. SLAs should outline what happens if they don’t meet those standards. Without them, it’s impossible to fully trust your fulfillment partner.
ShipBob: SLAs
According to ShipBob’s website, they do have certain SLAs, but there is nothing there that holds them accountable for those SLAs, so they are essentially useless. There are no stated amends if your orders ship out late, are picked inaccurately, or if receiving efforts are delayed.
On top of this, they disclaim any liability for delays in shipments from warehouses in their SFN.
You are able to see why any of your shipments are not within their SLAs, but that does not help you or your customers fix the issue.
Deliverr: SLAs
The big selling point for Deliverr is their 2-day shipping badges. These signify on certain platforms that you are offering 2-day shipping. The idea is to increase conversion rates like how Amazon does with Prime badges.
However, they do not guarantee same-day shipping so there is nothing stopping them from taking a week to ship your orders.
"Does Deliverr guarantee delivery SLAs? No. Deliverr does not generally provide any guarantees or remedies towards shipments that miss SLAs. We make our best efforts to meet the delivery SLAs and continually strive to improve upon them."
Additionally, their cutoff time in their delivery SLA is not promised, so there is no guarantee you’ll get reimbursed should their delivery estimates not be met.
"[...] 11AM PST / 2PM EST will typically ship the same day, if not the next business day."
And since COVID started they added some more conditions that state shipments may take an additional 1-2 days to ship. Clearly, while Deliverr promotes 2-day shipping on their site, it is evident that their badges and 2-day shipping are far from a sure thing.
OTW Shipping: SLAs
OTW Shipping’s SLAs make a difference when compared to ShipBob and Deliverr. With 99.99% order accuracy it is unlikely, but order errors will be reimbursed. If an order misses the 2pm cutoff time, we will make it right.
In terms of receiving, OTW Shipping offers free receiving, but does have a verified inventory option that is quite affordable with a one-time $0.10/unit receiving fee.
Summary
There is no "one-size-fit-all" center. The right fit for you can vary based on what you sell, how your business operates and your priorities. If you are struggling to find a 3PL that matches your needs, please contact us. Whether we are the right fit or not, we have an extensive network with the best in the business to help you find the right fulfillment partner.
ShipBob Review
Companies with a high # of picks per order will find ShipBob‘s pick & pack pricing very friendly. On top of that, they’ve invested a lot of money into developing their software, so you will find a user-friendly dashboard after you create an account.
Now, if you are doing thousands of orders per month internationally, having the ability to use multiple international fulfillment centers is quite advantageous for you and your customers to save on shipping and customs fees. For companies with lesser volumes, managing inventory for multiple locations can be complicated and sending inventory to multiple warehouses can actually be more expensive.
On the flip side, ShipBob’s unaccountability for meeting their SLAs and their SFN warehouse partners makes it tough to rely on them for your fulfillment. Additionally, many of their services are quite expensive relative to other 3PLs and there are a lot of additional fees that you’ll need to read the fineprint to be aware of.
Deliverr Review
For Deliverr, your decision can be a bit more straightforward. If you have a very simple DTC setup that doesn’t require returns, Deliverr has great pick and pack rates. Moreover, their 2-day shipping badges can boost your conversion rate on certain sites. Although, it is worth noting that their SLAs do not actually hold them to this 2-day delivery standard so 2-day delivery is not guaranteed.
If your setup will ever require anything other than basic pick and pack, Deliverr will not be a good option. They do not offer additional services like B2B, kitting, inserts, and so on.
Lastly, you must consider the 4PL model and whether you think a network of independent 3PLs partnering with Deliverr are able to offer the same level of service and consistency as a company that owns all their warehouses.
OTW Shipping Review
OTW Shipping certainly does not have the same financial backing as ShipBob or Deliverr. Our growth has only been through our customer-centric approach to fulfillment and industry-leading SLAs. From small businesses to eCommerce giants, you will get the same level of support.
Our software is employed by hundreds of other warehouses, so you’ll be interacting with a finely-tuned dashboard used by thousands of other 3PL clients.
And while we only have two locations, that is all you need to offer 2-3 day shipping at affordable rates.
