The Autumn Budget Just Made In-House Order Fulfilment More Expensive…

But the impact goes way beyond the four walls of your warehouse. It also touches the cost of getting orders from warehouse to customer. Carriers continue to introduce (and increase) accessorial charges. Delivery surcharges, fuel adjustments, out-of-area fees, rarely move down. And because 3PLs have stronger buying power and manage multiple carriers simultaneously, they’re able to absorb and negotiate these increases far more effectively than a single brand running its own fulfilment.

In other words, if you fulfil in-house, all of this including wages, warehouse overheads, and carrier costs, lands straight on your P&L. Sadly, there’s no buffer and no sharing the load. So you may already be thinking:
‘OK… but what does this actually mean for my business next year?’

Let’s talk about it honestly.

Jump to:

• The Budget Has Made Running a Warehouse MUCH More Expensive
• In-House Teams Will Feel Every Hit Directly
• 3PLs Absorb What You Can’t
• Outsourcing Turns Scary Fixed Costs into Predictable Ones
• 2026 Will Reward the Brands That Move Early
• Ready to Protect Your Margin Going Into 2026?

The Budget Has Made Running a Warehouse MUCH More Expensive

Warehouses will cost more to operate. Staff will cost more to pay. Energy (while stabilising for households) is still subject to regulatory charges and business-side volatility. None of this is hypothetical, in fact, these changes start hitting in 2026.

With the National Living Wage rising again on top of several consecutive increases, employers are now dealing with cumulative wage inflation, not a one-off bump. Add to that the rise in employer National Insurance, and the pressure on payroll becomes impossible to ignore.

It’s also not just the people on NLW who are affected.
When base pay rises, the entire pay structure shifts with it. Supervisors and team leaders naturally expect wage differentials to remain intact. Managers start questioning compression between experience tiers. That ripple effect can turn one statutory rise into a full-scale payroll reset.

Let’s not forget that NLW increases affect your suppliers too. Carriers, manufacturers, packaging providers, indeed, anyone with a large labour component. When their wage bills rise, their charges rise. Which means: so do your costs!

So the real question isn’t only:
‘How much of my warehouse operation depends on NLW labour?’
It’s also:
‘How will rising wages across my entire supply chain impact my margins?’

In-House Teams Will Feel Every Hit Directly

This is the uncomfortable part. When you run your own fulfilment, every cost increase lands with full force. Higher business rates? You pay. Insurance and compliance creeping up? Also you. Overtime, temp staff, Peak premiums… the list is long and unglamorous.

But – and here’s the balance – many business leaders have been expecting wage rises as NLW changes come every April. Inflation isn’t what it was last year. Some pressures have eased, and many FDs and founders are far more prepared than the headlines suggest.

Even so, the combined effect of wage increases, rate changes and supply-chain cost pressures still forces an uncomfortable and very logical question:

‘Is my in-house fulfilment operation still helping me scale, or is it quietly draining profit?’

3PLs Absorb What You Can’t

This is where outsourcing suddenly looks a lot less like a nice to have and more like a financially strategic move.

A 3PL spreads its staffing, energy, warehouse, carrier and compliance costs across multiple sites and hundreds of clients. Rising wages? Yes, they’re felt — but diluted. Business-rate surcharges? Split across the network. Carrier increases? Negotiated at scale.

And it’s important to acknowledge this:
Outsourcing is a big decision.

Fulfilment is often the second-largest cost area for an e-commerce brand, so it’s natural for it to feel like a big step. But it’s also true that running your own warehouse means carrying fixed assets 365 days a year such as staff, space, equipment and insurance, whether orders are flooding in or trickling through.

Outsourcing swaps that fixed-asset burden for something far more activity-based and flexible.

Instead of carrying all of that alone, your brand becomes one part of a much bigger, much more efficient machine. Which leads to a much more useful question: why take on 100% of the inflation when someone else can carry most of it for you?

Outsourcing Turns Scary Fixed Costs into Predictable Ones

Anyone who’s run a warehouse knows that fixed costs never sleep.
Busy or quiet. Peak or off-peak. Those bills don’t care.

It’s not just staffing or space. It’s the packaging. The waste management. The IT. The equipment repairs. The maintenance. The training. The unexpected breakdowns. The fire safety checks. The stuff you never budgeted for but always end up paying for.

Outsourcing flips this whole model. Suddenly, you’re paying for what you actually use. If sales dip, your fulfilment costs drop too. If sales spike, you scale without scrambling for temping staff or desperately trying to find some extra space.

Instead of managing a small logistics empire on the side, you actually get to focus on the part of the business that moves the needle: product, growth, and delivering the experience your customers expect.

2026 Will Reward the Brands That Move Early

The combination of higher rates, higher wages and shifting supplier costs is going to create a natural divide in the market. Not a dramatic survive or collapse scenario but a significant difference in operational resilience.

Brands that outsource will enjoy:

• a more predictable cost base
• simpler budgeting
• fewer operational shocks
• more time to focus on product and growth

Brands that stay in-house will still succeed  but they’ll feel more of the rises, more of the squeeze, and more of the volatility, whether it’s in the form of taxes, levies, or supplier price adjustments. Which is why it’s worth asking the honest question:

Is running your own fulfilment operation still the best use of your money, your team and your time?

Because the Autumn Budget makes one thing very clear: NOW is the moment to review your operations.

Ready to Protect Your Margin Going Into 2026?

ILG helps fast-growth brands scale with fulfilment that’s stable, predictable and built for international expansion. By outsourcing, you’re not just saving time and operational stress, you’re gaining a more cost-efficient, more flexible and more future-proof model. If you’re rethinking your operations, we can show you exactly what outsourcing could look like for your brand. Book a call to speak to one of our friendly experts when Peak 2025 is done and dusted. We’re here to support you through 2026 and beyond.