Fundamentals of Warehousing

Fundamentals of Warehousing

Warehousing is one of the most important logistical aspects that new businesses fail to take into account while formulating their business plans. Need for warehouse plays a major role in the budgetary considerations of any new venture, as it calls for creating infrastructure in the form of storage buildings, means of transportation, and associated maintenance costs and manpower. In fact, this work is different form core business aspects and requires certain level of expertise and knowledge. The following are certain basic fundamentals and facts pertaining to this warehousing concept.

1. Warehousing is important for companies and firms that deal in manufactured goods and products. Furthermore, this can also have significance for companies providing services with respect to various equipment. However, this is only relevant when the company or firm does not have its own facilities.

2. Storage and transportation services can be acquired from outside agencies that specialize in these kinds of services or already have extensively established infrastructure in terms of transport and storage. Usually, companies prefer to blend the two concepts of renting storage space and having their own. More specifically speaking, companies have their own warehousing facilities near their base of operations and hire storage space when it is needed at some remote locations.

3. Warehousing is especially important for companies that are involved in export and import businesses. Material imported can be stored in the storage facilities located near the ports. This is particularly beneficial because until the goods are taken out of the storage facility, no duties are required to be paid. Furthermore, in case the goods are exported from the same location, no duties are also required to be paid.

4. The majority of storage facilities can be around ports, airports, industrial townships, and industrial sectors of major cities. These are the prime locations for companies and storage facilities. The location is advantageous from the point of view that spurious transportation costs can be reduced through the storage facilities. These locations are also ideal for storage facility owners because of the easy availability of clients.

5. The cost of hiring these storage facilities for the warehousing purpose varies depending on the services that are needed. Storage facilities range from fully manual to semiautomatic and to even fully automated, where even the cranes and forklifts are controlled by computerized software. The level of material security increases with rise in the level of automation in the warehouse. It has a direct bearing on the rent of storage units. In addition to this, storing perishable items requires climate control, such as cold storage, and hence costs more.

6. The process of keeping track of materials stored in the storage facility is known as Warehouse Management System (WMS). WMS calls for specialized skill and requires expertise in handling logistic aspects and computer software. Furthermore, big industrial storage facilities are also equipped with loading and unloading docks for trucks and transport vehicles to carry goods from or into warehouses. Also, some of these types of storage facilities, depending upon their location, can also be equipped with railway loading and unloading docks wherein goods can be loaded and unloaded directly from cargo trains.