Decentralized Fulfillment

Decentralized Fulfillment

The rise of decentralized fulfillment options is emerging but the way the strategy will be ultimately realized is yet to be seen.

There are many ideas in the space and companies tackling the opportunity to make shipping times faster and ordering online more convenient for consumers.

No specific model has yet emerged to dominate the industry as a go-to standard for ecommerce sellers.

Let's look at the the how the decentralized movement is affecting ecommerce.

Centralized vs Decentralized Fulfillment: The Decentralization of Ecommerce Shipping

Inventory decentralization is an emerging strategy for ecommerce product fulfillment that can compete with the standards set by Amazon.

Decentralization of shipping utilizes multiple warehouses to store goods closer to the end buyers so orders can be fulfilled faster. This is especially essential for multi-country fulfillment and taking advantage of the global market for your products to increase order sales across borders.

Some see the trend of centralized models diminishing in many industries, such as computing and airline travel. 

One common argument against the decentralized shipping model is the belief that it tends to have increased operational costs.  But, when you partner with a fulfillment provider that has an integrated fulfillment system and multi-warhouse options, both domestically and globally, then the operational costs become marginal.

How the execution of this trend pans out is yet to fully take shape. Some have argued that there will be fulfillment by everyone (FBE) where random individuals and businesses will monetize underutilized assets by adding them into networks and, thus, building out a new infrastructure in a way similar to the rise of AirBnB and Uber.

Proximity of Inventory to End Buyer Decreases Shipping Time

The Amazon threat increased online buyer expectations and is forcing the decentralization movement to speed up because not having quick delivery times is a conversion killer for online sales.

Last mile decentralized fulfillment is thought to be the solution to affordably decrease shipping times while remaining cost competitive to the threat of larger players like Amazon.

Decentralized in the context of fulfillment can be more easily understood as one's e access to multiple warehouses for product distribution. Amazon maintains a distribution advantage because it operates its own decentralized warehousing centers across the world.

One example of the move to local distribution is the network being set up by Shopify, you can find out more about it in the video below.

Free Shipping: The Amazon Effect

Again the Amazon threat rears its head because of the convenience of Amazon Prime and it’s free shipping option; and also, Amazon's free shipping offer when an order reaches a minimum cuttoff value to make it profitable for them to ship for free.

To remain competitive, maintain high conversion rates and keep in business, free shipping remains the key that many still have not adequately used to unlock more sales.

There are many tactics to bake fulfillment fees into the product product pricing and also differentiate the product - even commodity items - by creative positioning via options like bundling, guarantees, and required order value minimums to earn free shipping.

Decentralized Order Fulfillment a Response by Merchants and Retailers to Take on Amazon

Micro-fulfillment and the current spread of new options opening up against centralized models can largely be seen as a response to Amazon’s dominance in the online retail space and the expectations Amazon has created for the standard of how conveniently products can be delivered once ordered online.

The consumer stands to benefit from this order fulfillment trend. 

Decentralized fulfillment will allow online shoppers shorter delivery windows and more options for quick delivery outside of the Amazon ecosystem.

Thus, a more diversified market is emerging for those shoppers who need their purchased quickly without having to go to a retail shop to get them.

For ecommerce sellers, there are challenges to adapt. 

But it is becoming increasingly easier for ecommerce merchants as many fulfillment providers, such as Fulfillment Bridge, are building the technologies and networks to enable same-day shipping and democratize fulfillment for all.  

The infrastructure of the future is being laid as we speak, decentralized fulfillment is becoming a reality for ecommerce.

After the Checkout: Make Shipping Easy on Yourself with the Help of Fulfillment Bridge

Once you have your site optimized, from guests checkout options and pricing to images and user generated content, your sales will start to climb. Prepare to keep your customers happy and yourself sane by taking advantage of the full suite of Fulfillment Bridge Ecommerce solutions.


When you are ready to take your ecommerce shipping and fulfillment to the next level, contact Fulfillment Bridge

Kais Khadhraoui
Kais Khadhraoui
I'm the CEO & Founder at Fulfillment Bridge. I spent more than 12 years providing cutting edge financial solutions to global banks and stock exchanges and running successfully Multimillions projects at global scale. I decided 8 years ago to start my entrepreneurial adventure in the eCommerce industry. I discovered similarities in both fields which made it easier for me to provide high quality eCommerce related services inspired from the Fintech world. My ultimate goal is to create a leading eCommerce solution following the high standards adopted in the financial industry. When you are looking to take your ecommerce to the next level and partner with a logistics provider that specializes in global ecommerce solutions, you can get in touch with me on LinkedIn.