Contract logistics is a longer-term outsourced warehousing and distribution arrangement governed by a service agreement, typically built around dedicated space, dedicated labour, or both, and priced on an open-book or fixed management fee basis rather than purely per transaction. It sits apart from transactional 3PL, where you buy pick-pack and storage by the unit inside a shared multi-client facility with no long-term commitment on either side. The distinction that matters for a procurement decision is term, dedication, and pricing basis: contract logistics trades volume commitment and contract length for configuration control and cost transparency. Warehouse Bridge sources both models, transactional and dedicated, across a network of 150+ pre-vetted Canadian facilities, so the sourcing process is the same regardless of which structure your volume points to.
Dedicated vs Multi-Client: The Decision
| Factor | Dedicated | Multi-client |
|---|---|---|
| Cost basis | Open-book cost-plus or fixed management fee | Per-transaction, per-pallet, or per-order rates |
| Volume commitment | Sustained, forecasted volume over the contract term | Consumption-based, no minimum in most agreements |
| Flexibility for seasonal swing | Low, fixed capacity regardless of volume | High, capacity scales with orders |
| Process configuration control | High, layout, WMS, and labour model built around your operation | Limited to what the shared floor supports |
| Typical term | 3-5 years | 1-2 years, month-to-month available in flexible segment |
| Typical minimum scale | 100,000+ sq ft, one full shift sustained | No fixed minimum |
| Best fit | Stable, high-volume, complex, or compliance-driven operations | Seasonal, growing, or lower-volume operations |
The decision comes down to utilization math. A dedicated building carries the same fixed cost, rent, base labour, equipment, whether volume shows up or not. The question worth answering before signing anything is what percentage of the year your forecasted volume actually keeps that building and crew productive. An operation running near capacity ten or eleven months a year gets real economies of scale from dedication: lower per-unit labour cost as throughput rises, a layout built for your SKU profile instead of a generic shared floor, and a team that knows your product instead of rotating across five clients. An operation with a sharp seasonal curve carries idle capacity for the months volume doesn’t show up, and that idle cost erodes or eliminates the savings dedication was supposed to deliver.
This is why many enterprise shippers run a hybrid model: a dedicated core sized to average volume, with multi-client 3PL fulfillment capacity layered on for peak. The dedicated building stays productively utilized year-round, and the seasonal spike gets absorbed by a network partner without forcing you to build (and then carry) capacity for a demand curve that only exists eight weeks a year. Facility availability for either model varies by market, so it’s worth checking capacity in your target region on the locations page before sizing the requirement.
Pricing Models: Open-Book vs Closed-Book
Contract logistics in Canada is priced one of two ways, and the choice affects incentives as much as it affects the invoice.
Open-book (cost-plus) passes through actual labour, occupancy, and equipment costs with a management fee layered on top, typically in the range of 4 to 8 percent of the cost base. Most open-book agreements also include a gainshare mechanism, where productivity improvements above a baseline are split between shipper and provider. Open-book gives you visibility into what you’re actually paying for, but it also means you’re carrying more of the operating risk and you need to actively govern the relationship rather than treat the rate as fixed.
Closed-book prices fixed rates per transaction, per pallet, or per square foot. The provider carries the operating risk, labour cost increases, productivity shortfalls, and equipment downtime are their problem, not yours, and that risk gets priced into the rate as a premium. Closed-book incentivizes the provider to run efficiently because every productivity gain they capture stays with them rather than flowing back to you. Open-book flips that: you get to see the underlying cost structure, but you need governance in place, regular reviews, audit rights, clear cost allocation rules, to make sure the transparency actually translates into a well-run operation.
An open-book agreement needs to define, in writing:
- Cost base inclusions: exactly which costs (labour, benefits, occupancy, equipment depreciation, consumables) flow through, and which are excluded
- Allocation method for shared costs: how costs for shared supervision, IT, or facility overhead get split when the building isn’t 100 percent dedicated to you
- Audit rights: your ability to review the provider’s books against the cost base on a defined schedule
- Gainshare split and measurement: the baseline productivity metric, how improvement above it is measured, and the split ratio
For general market rate context across pricing models, see the 2026 warehouse costs guide.
What Volume Justifies Dedicated
The rough floor for a dedicated program is enough sustained volume to justify 100,000+ square feet and keep at least one full shift productively busy across the year. Below that line, the fixed cost of an underutilized dedicated building typically exceeds whatever per-unit savings dedication was supposed to deliver, and multi-client pricing wins on a total-cost basis.
Square footage is the easy number to point to, but labour utilization is the real driver. A 100,000 square foot building with a crew sitting idle half the week doesn’t generate the productivity gains that justify dedication in the first place. The better question is whether your volume, spread across a normal operating calendar, keeps a shift consistently busy. That’s a labour planning question as much as a real estate question.
Peak-to-average ratio is where this math breaks down for a lot of shippers who assume dedicated is the more sophisticated choice. A business running a 4:1 Q4 peak that sizes a dedicated building for that peak carries enormous idle capacity for the other nine months of the year, fixed rent and base labour on a building that’s a quarter utilized outside the holiday run. That peak-to-average profile is the classic case for a dedicated core sized to average volume, with multi-client or flexible overflow capacity absorbing the peak instead of permanent square footage built to handle eight weeks of demand.
The Canadian Variables
Labour markets by city. Labour is usually the binding constraint on a dedicated operation, ahead of rent. Toronto and Vancouver carry the highest warehouse wage rates and the tightest labour markets in the country, which raises both direct cost and turnover risk on multi-shift dedicated operations. Calgary, Edmonton, and Winnipeg offer meaningfully lower labour cost and better availability, which is a large part of why cost-driven dedicated operations often locate in the prairies and accept longer transit time to eastern demand centres in exchange. Any dedicated site decision should model fully loaded labour cost and expected turnover for the specific market, not just the quoted lease rate, because turnover on a dedicated crew shows up directly in your productivity numbers.
Quebec. Consumer-facing documentation, packaging, and labelling handled out of a Quebec facility fall under Bill 96’s French-language requirements. If a dedicated program includes Quebec-facing packaging or labelling work, that obligation needs to be built into the WMS configuration and the operating procedures from day one, not retrofitted after go-live.
CBSA bonded and customs-deferral options. Import-heavy programs benefit from bonded warehouse status, which defers duty and tax until goods are released from the facility rather than at the border. For a dedicated operation handling significant import volume, evaluating bonded status as part of facility selection can materially change landed cost timing.
Provincial employment standards. Shift structure, overtime rules, and statutory holiday treatment differ by province, and those differences affect both labour cost modelling and how a multi-shift dedicated operation gets scheduled. A labour model built for Ontario doesn’t transfer directly to Alberta or Quebec without adjustment.
Running a Competitive Process
Enterprise buyers evaluating a dedicated or contract logistics program should compare at least three providers against an identical set of assumptions, same volume forecast, same service levels, same facility specifications, so the quotes are actually comparable rather than apples to oranges. The RFP process guide covers the full timeline and structure, and the B2B wholesale RFP guide walks through the requirement-definition step that a dedicated program depends on getting right before quotes go out.
Warehouse Bridge produces comparable operator quotes normalized to a single requirement set, which is the same output a formal RFP produces, but in days rather than the eight to twelve weeks a full process typically takes.
Scoping a dedicated or contract logistics program? Tell us the requirement once and get matched with pre-vetted Canadian operators sized for it. No sales call required to start.
Start the requirement →Where to Start
If you’re still deciding whether dedicated makes sense at all, the in-house warehousing vs 3PL guide covers the build-vs-outsource decision that usually comes before the dedicated-vs-multi-client one. Once the requirement is defined, the RFP process guide lays out how to run a comparable process across providers, and the Canadian Warehouse Market Report 2026 has current market context to sanity-check what you’re being quoted.