WMS, Warehouse Labor & Fulfillment worked example

Order Fulfillment Cost at 110% cost allocation share to this channel: a worked example

Push cost allocation share to this channel up to 110% and the picture changes. This example computes every intermediate figure at that operating point. An operations lead uses it to allocate fulfillment cost across channels for margin reporting.

The inputs for this scenario

  • Orders Fulfilled per Period: 6,000 orders (unchanged)
  • Variable Pick-Pack-Ship Cost per Order: 5.5 $/order (unchanged)
  • Cost Allocation Share to This Channel: 110 % (raised for this scenario; the documented default is 100)
  • WMS & Facility Fixed Overhead: 8,000 $ (unchanged)

Working through the calculation

  • Applying the documented formula (Total fulfillment = orders x variable cost per order x allocation % + facility overhead) to the inputs above produces each figure below.
  • At this operating point the engine returns 44,300 $ for total order fulfillment cost, the number this scenario is built around.
  • At this operating point the engine returns 7.38 $ / piece for order fulfillment cost per unit.
  • At this operating point the engine returns 36,300 $ for variable order fulfillment cost.
  • At this operating point the engine returns 8,000 $ for fixed order fulfillment cost adder.

How this compares with the baseline

  • Against the tool's baseline example, where cost allocation share to this channel sits at 100% and the headline result is 41,000 $, this scenario comes in 8.05% above the baseline at 44,300 $.
  • It computes total fulfillment cost and cost per order from orders, a variable per-order cost, an allocation percentage, and a fixed facility overhead adder. The value of this scenario is the size of the gap it exposes: that gap, priced out over a year, is the budget you can justify spending to close it.

Results at a glance

  • Total order fulfillment cost: 44,300 $ (headline result)
  • Order fulfillment cost per unit: 7.38 $ / piece
  • Variable order fulfillment cost: 36,300 $
  • Fixed order fulfillment cost adder: 8,000 $

Run it with your numbers

  • Every input above is editable in the live Order Fulfillment Cost calculator, which recalculates instantly and can be shared with the inputs intact.

Last reviewed 2026-05-12.