Shipmonk is an e-commerce fulfillment center started in 2015 that has grown exponentially over the past five years. In 2020, Shipmonk raised $290 million to fund further growth. Oftentimes, companies that experience growth quickly struggle to keep up with customer service and service levels.
Shipmonk Pricing: Pick & Pack Rates
Comparing Shipmonk's base pick & pack rates to OTW Shipping, OTW Shipping came out up to $0.25 cheaper per order. For both companies you are able to obtain a custom quote which may be cheaper than the base rates provided here.
Shipmonk Pricing: Shipping Rates
As for shipping, Shipmonk's rates are confidential and require strict vetting of your company before they will disclose them so we were unable to compare our rates.
Shipmonk Pricing: Services
Shipmonk has a very similar volume-based model to OTW Shipping in terms of pricing. Both Shipmonk and OTW Shipping allow for custom quotes based on your business that can potentially allow you to negotiate better rates based on your business needs so it’s best to contact them for the most accurate rates.
The main difference between Shipmonk and OTW Shipping pricing is that Shipmonk offers free receiving to all clients regardless of volume. While this sounds nice, it is because they rely on what they call "Good Faith Receiving", where they are only responsible for receiving master cases. You do have the option to enroll in a "Verified Inventory" program which increases liability to $250/unit, but this is an additional charge which we were unable to locate. OTW Shipping’s receiving cost can be free or up to $0.10/unit depending on your order volume, but includes quantity and quality control which can save you in the long run by minimizing inventory shrinkage.
Hidden Fees + Fineprint
While you get free receiving from Shipmonk, you are not obtaining the same level of quantity or quality control as if each unit was physically counted unless you use their "Verified Inventory" program. They rely on what they call "Good Faith Receiving" which has stringent guidelines. Here is their policy below:
“Due to good faith receiving (i.e. not counting each individual unit) and relying on supplier information noted on the inbound shipments, ShipMonk cannot ensure accuracy of inventory counts. Although inner cartons are not opened to account for every unit, cases and pallets are counted as an additional level of verification. ShipMonk will limit its liability up to $10/unit for full cartons that are missing after they were received and accounted for in our system. A valid purchase order and proof of payment must be provided before any credit is issued.”
In layman's terms, Shipmonk is not opening your boxes to check your inventory at any point. Thus, they are only liable when full cases go missing. This could be a big red flag for your business. As suppliers are notorious for sending miscounted inventory, proper receiving does play a huge part in mitigating losses. You can always use their "Verified Inventory" program, but this may cost extra. We did some deeper digging into their service level agreement and this was their policy on risk of loss:
“Company hereby agrees that at no time during the period that Products are held by ShipMonk as Inventory in the Warehouse will ShipMonk carry the risk of loss in the Inventory. Risk of Loss in Inventory will continue to be held by Company until such time as the Products are delivered to the End-User. ShipMonk shall exercise commercially reasonable standards of care for all of Company’s Products in its possession but specifically disclaims liability of loss except for instances of Gross Negligence by ShipMonk.“
It’s important to note that Shipmonk restricts liability to gross negligence in their policy. Most 3PL contracts are based on ordinary negligence, not gross negligence. This could put you at a higher level of risk so be sure to do your own due diligence.
Shipmonk is a newer 3PL that has grown exceptionally fast over the past few years. This has allowed them to invest in multiple warehouse locations across the country and become one of the bigger names in the 3PL space. The size of the 3PL does not always determine pricing/quality however. As always, it is important to compare multiple 3PLs before picking a partner as pricing and pricing models may differ.