Reshaping Fulfillment Networks— for 2026 and Beyond

Fulfillment networks are steadily evolving in three noticeable ways.

MAKE NO MISTAKE about it. When it comes to micro‑fulfillment and omnichannel strategies, a variety of shifts are occurring. In fact, many—if not most—of these shifts will continue well beyond 2026.

Why? Simply put, companies are striving to meet their customers’ ever‑rising expectations. Yet, at the same time, they’re often determined to do so without increasing their labor proportionately.

With this in mind, automation, AI, data analytics, real‑time inventory accuracy and reverse logistics aren’t just additions for supply chains anymore. They’re absolutely necessary capabilities. After all, they’ll help companies achieve two primary goals simultaneously: diminishing their manual workloads and enhancing their efficiency.

In preparation for these shifts, five logistics experts shared their insights about the evolution of fulfillment‑network architecture—from fulfillment node redistribution, to real‑time inventory accuracy, to reverse logistics loops.

REDISTRIBUTION = HIGHER EFFICIENCY

As Kevin Graebel reflects on recent trends, he believes fulfillment nodes are currently being redistributed according to customers’ service expectations and demand patterns, rather than transportation efficiency alone. In particular, companies are moving their inventory so that they’re closer to their customers via hybrid, store‑based fulfillment, micro‑fulfillment centers and regional locations.

Additionally, every single node isn’t designed to do everything anymore. Instead, networks now consist of specialized nodes. Each of these nodes has been optimized for certain roles, too, from returns processing to storage density and throughput.

“This redistribution requires strong system‑level coordination because inventory and order flow decisions now span multiple locations in real time,” said Graebel, chief product officer at MHI member Honeywell Intelligrated.

At the same time, nodes are increasingly being embedded within retail stores’ existing infrastructures. As this embedding occurs, retail stores are being retrofitted with dark fulfillment zones. According to Josh Lett, vice president of customer experience at MHI member Deposco, ship‑from‑store operations are no longer “margin‑dilutive workarounds.” Instead, they’re “legitimate network strategies,” especially for omnichannel retailers who already have the geographic reach they need but are seeking software for reliable execution.

Lett said that nodes are “being pushed upstream toward suppliers and manufacturers,” too. Consequently, vendors who can either fulfill direct‑to‑consumer or direct‑to‑store orders (or both) are the most reliable network assets now.

“The brands doing this well are extending their warehouse management system (WMS) logic into their supplier relationships, creating what amounts to a virtual, extended fulfillment network,” Lett said.

Meanwhile, Dr. Eva Ponce, director of the MIT Omnichannel Supply Chain Lab at the MIT Center for Transportation & Logistics, has noticed a clear shift regarding fulfillment node redistribution. Centralized fulfillment networks are less common, as they’re being replaced by architectures that are concurrently multi‑mode and more distributed. In agreement with Graebel’s sentiment, Dr. Ponce has noticed companies are adding more nodes closer to their customers. While doing so, they’re also maintaining larger fulfillment centers that are more automated and efficient.

“In practice, inventory is no longer concentrated in a few locations but pushed closer to the demand and distributed across the network,” Dr. Ponce said.

To ensure that nodes are closer to customers, they’re distributed “more intentionally” as well, according to Josh Hartman, vertical market strategy leader at MHI member Dematic. As a result, companies are considering how to combine centralized, full‑assortment facilities with smaller, strategically located metro or regional nodes.

“In this structure, larger hubs handle bulk storage and high‑volume processing, while smaller nodes position fast‑moving inventory closer to demand,” Hartman said.

By doing so, delivery speed increases, order fulfillment becomes more responsive and companies have more balanced networks “that can flex between centralized efficiency and localized responsiveness.”

Aside from improving companies’ delivery times, Landon Keatts, global key account manager at Körber Supply Chain, said that fulfillment nodes are being repositioned to diminish last‑mile costs, too. In Keatts’ opinion, the best option is densely populated areas with predictable order profiles and volumes. In turn, the risk for unintended, additional travel decreases.

“By aligning node placement more closely with demand patterns, companies can improve service levels, while reducing transportation inefficiencies,” Keatts explained. “This redistribution also allows companies to better align inventory deployment with customer expectations, supporting faster fulfillment and more consistent delivery performance across channels.”

AN ARCHITECTURAL REQUIREMENT

With regard to fulfillment‑network architecture, Keatts has noticed one major necessity: real‑time inventory accuracy. In fact, he thinks it’s “foundational to modern fulfillment network design.” There are a myriad of reasons. First, inaccurate inventory data leads to misrouted orders, mismanaged labor and a reduction in network performance as a whole.

“As fulfillment networks become more distributed, these inefficiencies multiply quickly,” he emphasized.

Second, inaccurate inventory data negatively influences customers’ experiences. If deliveries are delayed or missed, their trust will decline considerably, resulting in adverse effects, potentially long term. Thus, according to Keatts, real‑time visibility isn’t just an operational requirement. It’s a “critical component of maintaining service commitments” as well.

Graebel agrees, adding that whenever inventory data is inaccurate, automation performance, labor efficiency and service promises are directly hindered. Therefore, he stresses that fulfillment networks must be designed with two goals in mind: continuous visibility and closed‑loop feedback. Such visibility and feedback must occur between automation systems, execution software and operators, too.

“Inventory accuracy is no longer a reporting function at the end of a process,” Graebel said. “It’s an active input that drives routing, replenishment and execution decisions throughout the network.”

To further emphasize the significance of real‑time inventory accuracy, Lett describes it as “load‑bearing infrastructure.” In the past, it was simply a “nice‑to‑have.” He believes this substantial shift has occurred for several reasons. Whenever operators oversaw one distribution center for a single channel, inventory inaccuracy was just a “manageable nuisance.” But now that inventory is constantly being dispersed across numerous channels from a distributed node network? Inaccuracy is a “customer experience catastrophe” instead.

While network complexity continues to rise, so does the potential negative impact of inaccuracy. This complexity is related to countless factors, including channels, handoffs and nodes.

“Every additional node, channel and handoff in a supply chain is a place where inventory reality can diverge from inventory record,” Lett said.