Evaluate proximity to your customer base and main transport corridors, carrier frequency, facility type (racked vs bulk), pick-and-pack throughput, WMS/API compatibility, SLA commitments, and cost-per-pallet metrics. Prioritize providers with demonstrated peak-season scalability and transparent reporting on inventory velocity and OTIF performance.

Main cost drivers are rent and land rates, labor and handling charges, local transport (trunking and last-mile), utilities, and technology fees (WMS, integrations). Volume commitments, pallet density, and required value-added services (kitting, returns) materially shift per-unit costs—negotiate minimums and variable pricing for seasonality.

Require WMS with API/EDI connectivity, inventory accuracy >99%, pick-and-pack accuracy metrics, on-time shipment rates, lead-time SLAs, and clear reverse-logistics processes. Monitor KPIs like order cycle time, fill rate, cost per order, and returns processing time to ensure consistent omnichannel performance.

Key steps: perform a physical inventory audit, define SKU mapping and labeling standards, establish WMS integrations and test data flows, run parallel pick/pack cycles, agree SLAs and penalties, train teams, and schedule incremental cutovers to validate throughput before full migration.