Global Fulfillment Centers, Why You Don’t Need Them

Jeff Becker    |    December 1, 2022


As we expand our reach, and with the rise of remote work and more distributed work force, companies increasingly have reasons to ship items all over the globe.

Unfortunately, international shipping isn’t as simple as sending something domestically.
That is because of challenges with:

Higher costs

Duties & taxes

Long delivery time

Customs challenges

We have 2 fulfillment centers, one in Utah and one in Ohio, but we’re asked about global fulfillment centers on a regular basis to solve these 4 issues. In the past we’ve partnered with international 3PLs (third party logistics), and have looked at many options in different countries.

After a deep research dive and digging through the data, having global fulfillment centers is not a great solution to these issues for most of our clients and the majority of cases.

Geographical distance

One common misconception is that geographic distance is the primary driver of costs. While it certainly has some impact, many industries have supply chains that move materials between multiple continents before sending final products back to where they started. In some cases, geography is outright irrelevant, for example it’s cheaper to ship to Israel from the United States than from Europe.

For our business, the single biggest factor is simply whether the package can avoid customs clearance – and the only way to do that is if the end user lives in the same country as the fulfillment center. The reason shipping from our facilities to US locations seems so easy, affordable, and quick is that we aren’t dealing with clearing customs into another country.

For example, if you’re shipping to India and the fulfillment center is in India, it’s probably (keep reading) easier, cheaper, and quicker than shipping from the US. But if the package being shipped to India comes from anywhere else (even nearby in SE Asia), almost all the exact same problems exist as shipping from the US, but with new issues added. You still have higher costs, duties & taxes, and longer delivery times, all because of the need to clear customs.

If a client is almost exclusively in a single country, other than the US, then Kotis may not be their best option. They should find someone who is based out of that country and can source items from that country. But most companies do not have recipients in a single country; and each client has recipients in different sets of countries. To solve the underlying issues, many warehouses in many countries would be needed.

Product Complications

Then there is the question about the product itself. If you have multiple warehouses there are two different options. Ideally, you’d produce items in the same country as the warehouse. However, this results in a client holding identical items in multiple facilities, leading to more inventory overall than if they consolidate in a single place, which leads to higher client costs, more vendors, and risk of brand inconsistency. What happens if one facility runs out of an item – does a single order end up being two shipments, one from each facility?

Finally, where is the product made in the first place? The other option is to make them all the items in a single country and ship items to each of the warehouse. For example, we could keep making all the product in the US, and ship in bulk to multiple fulfillment centers. The problem with this option is it simply shifts the complications around as we now have higher duties and taxes and longer lead times due to shipping the product in bulk vs simply shipping individual orders to each country.

No one in our industry, even the $1B/year companies, have warehouses in even the top 5 global markets. That’s because the logistics of managing warehouses in multiple countries is a nightmare and simply does not offer the cost savings most people think it might.

3PL Complications

Trying to establish our own warehouses with our own employees would bring substantial legal and financial obligations while also being entirely impractical without massive scale in each location. We’d likely have to find a 3PL. But can they provide the same services? Can they meet our timelines? Can they comply with strict customer security requirements? Can they integrate with our platform? Are there any language or culture barriers? Will kitting and packaging be consistent?

There are variables we simply cannot guarantee will meet our Kotis standards when taking operations outside the US. We have instead focused our efforts on optimizing our existing warehouses, finding features and cost-saving measures that likely exceed potential savings from managing additional warehouses.

Kotis Design Named Market Leader in G2’s Fall Promotional Product Management Tool Report
September 17, 2021


The results are in! For the fourth consecutive quarter, Kotis Design’s Swag Platform has been ranked #1 on G2’s list of Promotional Product Management Tools By combining truly unique swag, our world-class, in-house print shops, and a leading software solution, Kotis Design has created the most compelling offering for promotional products.

Overall grid for Promotional Product Management tools

As our industry continues to grow (annual spend in branded merchandise has increased by ~5%/year to over $25B), Kotis has continued to invest in our products, processes, and people to create the best solution for our clients.

With an increased focus on technology and services, Kotis now manages the promotional products for thousands of companies, from startups to Fortune 500s.

The Promotional Product Management category has become increasingly competitive as more brands turn to swag as a leading marketing and sales tool. Kotis is the only provider in our space that is listed as a leader for small business, mid-market, and large enterprises. In fact, our technology services rank highest in the following categories among top performers:

  • Overall satisfaction
  • Ease of administration
  • Ease of doing business with
  • Quality support
  • Easiest to setup

Market grid for small businesses in Promotional Product Management

A Big Thank You to Our Customers
“The work that our customers have put in this past year as they’ve pivoted from in-office and in-person events has been amazing and inspiring,” said VP of Sales, Eric Hamlin. “We’re incredibly grateful that we were able to play a small part in making that transition as smooth as possible for our customers, their customers, and their people. Making swag that surprises and delights has always been core to what we do, and seeing how much a thoughtfully designed and delivered swag package, delivered straight to their front door, can make people happy has helped all of us at Kotis get through 2020.”

“The highly professional service from the staff at Kotis Design makes this resource one of the best I’ve ever experienced. Their comprehensive catalog of promotional materials, combined with the attention to detail and hands-on service, are second to none. Their processes are easy, streamlined, and smooth, and we have had no problems whatsoever in finding the right products, customizing them, and receiving them. Working with Kotis Design is a dream. Highly recommended.”
-Gary B.

“Having one company that can manufacture, warehouse, and run our ecommerce has been a huge benefit. Previously, I was working with over 20 vendors, running the web-store, and shipping orders myself. This has taken a lot of the ground work out, so I can focus on strategy and planning. I also value their ability to talk directly with the manufacturer, which they have relationships with–this helps guarantee quality and timelines.”
– Emily C.

About Kotis Design
We’re an industry-leading swag provider and a technology partner that offers a scalable eCommerce platform to help brands create, sell, and ship swag all around the world. From HR teams to sales and marketing sequences, we help integrate and distribute swag within your workflow. We make swag that people actually want to wear and use. Leverage our award-winning product design with a robust warehousing and fulfillment solution. Our two, US-based facilities combined with a network of overseas factories can send merch around the world. Well-timed branded merchandise can double or triple your opportunity value. Our Salesforce and Shopify integrations allow you to send merch when it makes sense, utilizing our warehouse and fulfillment teams. No need for a swag closet! Let’s build great merch, together.