According to Diamond Logistics, eCommerce brands bringing fulfilment operations in-house could be exposing themselves to millions of pounds in unnecessary operating costs.
Through its in-depth analysis of what running a 10,000 sq. ft warehouse in the UK truly costs in 2025–26, Diamond Logistics has revealed that the total five-year cost could reach £5.3m dependent on location.
Growth creates a fulfilment crossroads
For many budding eCommerce brands which have outgrown their existing setup, the next stage of growth often brings fulfilment into sharp focus as a critical operational challenge.
What might have previously been managed in-house, quickly becomes unscalable once order volumes increase, and product ranges expand.
At this point, businesses are forced to confront a crucial fork in the road. Therefore, they either invest heavily in building a dedicated in-house fulfilment operation or partner with a specialist logistics provider.
Touching on these figures Kate Lester, Founder and CEO of Diamond Logistics commented, “Having been in business for over 30 years, we’ve partnered with thousands of eCommerce businesses. They all had one thing in common, none needed their own warehouse or fulfilment operation.
“Businesses focus on the upfront setup costs and overlook the cumulative impact of ongoing operational expenditure. This is where the true financial pressure gradually builds over time.
“We wanted to take a deeper look at the true reality of these costs over a sustained period. Our findings highlight just how significant these expenses become over time, and how they can not only restrict growth, but potentially derail it altogether by tying up capital, locking brands into fixed costs, and diverting attention away from customers and products.”
While moving to a fully in-house operation might seem like a logical next step in maintaining control for many brands, Kate Lester believes that most eCommerce brands in the scale up phase would be better served by outsourcing fulfilment to a specialist provider.
Diamond Logistics also highlighted the comparative cost of eCommerce brands outsourcing their fulfilment operation. This comes out at a fraction of the cost.
A scalable alternative for growing brands
Kate Lester added, “In almost every case, the desire to invest in bricks-and-mortar logistics infrastructure is driven by a misalignment between perceived control and the true cost, complexity, and long-term commitment involved in running a fulfilment operation. However, once businesses begin to factor in the real costs including things from staffing to investment in WMS technology systems, the appeal of an in-house model quickly diminishes.
“In many ways, that’s exactly why the Diamond Logistics network was created. We wanted to give growing eCommerce brands access to the technology, infrastructure and fulfilment expertise they need to scale.
“Through our nationwide fulfilment network, we can combine warehouse management, fulfilment and multi-carrier shipping into one seamless system. Therefore, giving these businesses access to enterprise-level technology, competitive carrier rates and the operational support.”
Kate continued, “Through this offering, we can essentially provide eCommerce brands with a fully scalable solution that removes the burden of warehouse investment, long-term leases and building in-house fulfilment teams. We still give them complete visibility of their operations and the flexibility to help them grow.
“This isn’t a marginal saving we’re talking about, it’s potentially over £5 million over five years. Outsourcing to Diamond Logistics converts all of that into a single, variable, scalable cost. It is one that moves with our customer’s business, not against it.”
