Pricing pressure is rising across ecommerce. Customers expect lower prices, faster delivery, and transparent landed costs. Many brands have optimized every controllable lever, yet competitors still undercut them by 30-40% on nearly identical products.
This shift is not driven by better marketing. It is driven by a supply chain structure that removes layers instead of adding them.
Temu accelerated this expectation. It proved that products can be delivered cheaply when the order flows directly from the point of production to the customer. The model works because it compresses handling, capital, and time.
You do not need Temu’s scale, subsidies, or massive team to apply the same structural advantage. You need a fulfillment model that removes friction at the source.
This is where direct fulfillment becomes a practical and profitable alternative.
Temu removed layers that most ecommerce brands still treat as mandatory.
Layer 1: Importers and Distributors
Layer 2: Domestic Warehousing
Layer 3: Multiple Fulfillment Touchpoints
The result: products reach customers about 40% cheaper, even with longer delivery times.
Temu has reported multi-billion-dollar losses while scaling aggressively. Their rock-bottom prices are subsidized by venture capital, not operational margins you can replicate. But the structural efficiency behind their model is real and replicable. Remove redundant touchpoints, and those savings compound whether you're moving 10 million units or 10,000.
Temu owns factories, capital, and massive data infrastructure. Most ecommerce companies operate with:
But brands can adopt the same structural logic by using a hybrid version of direct fulfillment.
The winning strategy is to apply direct fulfillment to a focused group of high velocity SKUs where the savings and agility matter most.
Direct fulfillment is a logistics model where orders ship directly from the point of origin to the customer. This usually means factory, near-factory consolidation centers, or regional origin hubs that sit upstream of the traditional import cycle.
Direct fulfillment removes:
Most brands think of “factory direct” as a sourcing strategy.
Direct fulfillment is the logistics model that makes factory-to-door practical at scale.
Portless is the company executing this model for ecommerce brands.
Most brands should begin with a hybrid model. Start small. Apply direct fulfillment to the SKUs that make the biggest difference.
Pull your past 12 months of sales data. Look for:
These are your test candidates. Your top 20% of SKUs - your “hero SKUs” - likely generate 60–70% of orders.
Example: A home goods brand with 200 SKUs discovered that 15 SKUs represented 65% of revenue. Those became their direct fulfillment pilot.
Traditional model
FOB $8 + Import (including duties) $3 + Storage (60-day average) $2 + 3PL Fulfillment $6 = $19 total
Factory-direct model
FOB $8 + Direct fulfillment $7 + Duties (paid at point of sale) $1.50 + Storage $0 = $16.5 total
Savings: $2.50 per unit, or about 13%.
Working capital impact: Traditional model requires paying for 60 days of inventory upfront. Direct fulfillment means you pay as orders come in, turning a 60-day cash cycle into a 7-10 day cycle.
At 1,000 monthly units, that's $30,000 in annual cost savings plus significantly improved cash flow.
Most suitable categories:
Caution categories:
Note: FOB (Free On Board) indicates that the buyer assumes ownership and freight risk once goods are loaded at the point of origin.
Start with 3-5 top SKUs.
Split orders: 70% through your existing 3PL, 30% through direct fulfillment.
Track:
Red flags:
Delivery times >15 days, damage rates >3%, or service tickets increasing faster than savings.
If the test hits your performance targets:
Your 3PL remains important.
Direct fulfillment handles predictable volume.
3PL handles fast ship, peak seasons, and bulky SKUs.
Most brands don't have the infrastructure to manage logistics in-house. You need customs expertise, carrier relationships across 20+ last-mile networks, and systems that route orders intelligently between origin and domestic fulfillment.
This is where Portless becomes the operational layer.
Portless provides the logistics infrastructure that lets ecommerce brands run a Temu-style model without rebuilding their supply chain from scratch.
Portless handles:
You bring your manufacturing partners.
Portless turns them into a fast, lean, scalable supply chain.
Week 1: Analyze your data
Identify top 20% SKUs, all-in costs, and return rates.
Week 2: Assess feasibility
Filter for products suitable for factory-direct. Estimate potential savings.
Week 3: Explore partners
Explore factory direct capable partners. Request pricing and case studies from brands at your scale.
Week 4: Decide and test
Compare savings vs. platform fees. Start with a small pilot and measure results.
Temu’s strength was not advertising.
It was structural efficiency.
Direct fulfillment is the model behind that efficiency.
Brands do not need Temu’s budget to use the same structural advantage.
They only need to apply it to the right SKUs, measure the impact, and scale the wins.
The brands that treat fulfillment as a profit lever in 2025 will be the ones thriving in 2026.
Ready to explore how Portless enables direct fulfillment? Contact us.
Part 2: Speed vs. Scale — How to Test Products Like SHEIN Without the Baggage
Part 3: Olive Young: Diversification as Resilience — How to Build a Flexible, Multi-Brand Ecosystem
