Radial Survey Reveals 70% of Modern Brands Rely on In-House Fulfillment, Impeding Their Own Growth

Radial, Inc., a bpostgroup company, the leader in eCommerce solutions, today announced the results of a new survey of 200 retail decision-makers that uncovers the fulfillment challenges, new retail channels and transportation costs modern brands face.

The findings demonstrate that these fast-growing, tech-driven retail brands are still trying to manage fulfillment in-house despite facing mounting challenges as consumer expectations for seamless and fast delivery grow. In fact, 70% rely on an in-house strategy with multiple distribution centers and 59% operate within a single facility.

"As modern retailers scale operations and navigate customer demands, many are finding that in-house fulfillment alone is not sustainable and stretches their internal resources," said Tom Schmitt, CEO of Radial. "Our research shows that as brands near the $50M revenue mark, outsourcing to a logistics partner is much more common, showing there is an inflection point where partnership with a trusted 3PL helps unlock efficiencies and future-proofs operations against the dynamic retail landscape."

Fulfillment Operations are at a Crossroads

Nearly half (47%) of all respondents cited the ability to manage growth and scale as a significant challenge with their current fulfillment strategy. Similarly, 44% noted their limited ability to add new channels and capabilities while 40% pointed to inflexible technology, underscoring how a lackluster fulfillment technology stack is holding them back. Even so, 60% of brands under $50M in revenue are still approaching fulfillment in-house within a single distribution center.

The findings show that as brands reach $50M in revenue, their fulfillment strategy becomes more complex and requires industry expertise that smaller brands tend to be insulated from. Outsourcing to 3PLs is much more common among brands in the $50-100M revenue range at 57%, $100-150M range at 72%, and $150-200M range at 76%. Scaling successfully requires retailers to focus on the industry they know best and building a partnership ecosystem to fill the knowledge gaps.

DTC and Marketplaces Play a Critical Role

Brand websites are the dominant retail channel across brands of all sizes, with 72% of respondents indicating this is a primary sales channel, especially for 89% of home furnishing brands, 71% of apparel companies and 69% of sporting goods sellers. These category retailers establish their brand identity and promise through an owned customer experience before venturing into new channels and selling models.

Walmart and Amazon are tied at 56% each for the most cited new channel sellers are adding as well as the ones they are pulling back on at 49% and 47%, respectively. While the path for growth seems to follow where customers shop, many are finding it a balance act as they chase new customers on large, well-established marketplaces while simultaneously dealing with the stringent requirements and high fees often associated with these channels. Newer, emerging channels like TikTok Shop, Temu and Shein showed some interest from surveyed brands but were less of a priority compared to more established channels.

Overall, reliance on any one channel presents obstacles from fulfillment complexities to unique marketplace terms and inventory management nuances. Brands that look at omnichannel fulfillment better position themselves for long-term success and scale.

Managing Transportation Costs at Any Scale

When it comes to transportation challenges, unexpected additional charges are an issue for 45% of all respondents, but it is more acute (53%) for larger brands over the $100M revenue mark. Similarly, 42% of all retailers pointed to challenges with high base costs, although it troubles smaller brands ? those under $50M in revenue ? more frequently at 58% as their buying power is more limited with carriers and utilizing multiple carriers can be resource-heavy. Regardless of size, brands can benefit from an established fulfillment partner to manage their complexities with technology and lock in strong rates and services without having to directly work with those carriers.

Survey results underscore the importance of building a network of partners, one that includes an experienced and trusted logistics provider, to unlock new efficiencies and reduce obstacles that hinder brand growth. Consumers remain cautious to spend in the face of ongoing economic uncertainty. Brands must keep pace by reducing fulfillment obstacles to secure returning customers and bolster their bottom line.

To learn more about how modern brands in key eCommerce verticals can improve and scale fulfillment operations, visit www.radial.com/fast-track.

Methodology

Radial conducted the survey with Dynata in March 2025, of 200 key decision makers for growing brands across Apparel, Shoes & Accessories, Home Improvement & Garden, Sporting Goods & Fitness Products, Home Furnishings & Home Goods, Health & Wellness, Electronics & Computers, and Toys, Games and Books industries.

About Radial

Radial is the largest 3PL fulfillment provider also offering integrated payment, fraud detection, and omnichannel solutions to mid-market and enterprise brands. Leveraging over 30 years of industry expertise, Radial tailors its services and solutions to align strategically with each brand's unique needs.

Our team supports brands in tackling common eCommerce challenges, from scalable, flexible fulfillment enabling delivery consistency to ensuring secure transactions. With a commitment to fulfilling promises from click to delivery, Radial empowers brands to navigate the dynamic digital landscape with the confidence and capability to deliver a seamless, secure, and superior eCommerce experience.