Thursday, 27 December 2012

How Does Warehouse Add Value? Part One

warehouse & distribution
The need for simple storage solutions remain a problem area for businesses and retailers, but do warehouses really add value? How can you make the most out of the expense of renting warehouse space and what method would work best for you?

There are nine types of warehousing, we shall be covering three types over the next three days. 

1. The Accumulation of storage

A warehouse can be used to provide a solution for problems with overflow. This is an excellent method of storing large numbers of stock over seasonal periods of extra sales or as a long term option to help buffer the supply and demand balance. You can store parts to prevent down time and keep a huge inventory of supplies to help support day to day operations. 

2. Postponed Sales 

A warehouse is the place to store goods during their final step – waiting for an order to come in from a customer. You can use this space to customise goods, making the finishing touches to products that practically completed. This provides a way to reduce the generic form of inventory and works best for standard product manufacturing. 

3. Consolidation area 

A warehouse is often used to store goods in large quantities before they are shipped to the final destination. The costs of the warehouse can be easily justified thanks to the savings that are made in the cost of shipping. Larger volume shipments mean great savings and fewer shipping payments due to less frequent trips needed to transport products in low volumes. You can store finished goods that are sourced from multiple locations and send them out together from one central warehouse. Tomorrow we shall be looking at the next three types including: Hub and Spoke Distribution, Transforming Products and Assembly orders.

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