In a few words, a warehouse is a large building where products and materials are temporarily stored before being sold or exported. A large variety of businesses might need access to warehouses.
When a company identifies a need for a warehouse, they should explore the different types of warehouses to choose the best one for their specific products.
Let’s explore the most common types of warehouses. Each warehouse type will be utilized for a different type of business, so choosing the best warehouse for your business needs is an important step in your supply chain.
Distribution centers hold products for a short period of time and see a much higher velocity of products coming in and going out. Products move within a distribution center much quicker than in a typical warehouse, goods are procured from multiple suppliers and are quickly transferred to various customers
Those are very customer-centric and are typically located close to where the end user is, so they receive products quickly. A distribution center may also provide value-added services, such as cross docking, pick and pack services, labeling or packaging. Because a distribution center offers more services than a warehouse, they are also equipped with much more modern technology to make the processes easier.
Generally affordable for companies that sell to wholesalers.
A smart warehouse is a warehouse where the storage and fulfillment processes are automated with AI, such as robots and drones. These warehouses use automation systems and interconnected technologies to receive products, put them away, pick them for orders, ship them, and keep an accurate inventory count. This type of warehouse use technology to increase production, decrease errors, and minimize the number of humans needed to run the warehouse.
Smart warehouses have been a go-to option for large e-commerce companies such as Amazon and Alibaba that seek to make their order fulfillment and inventory management a more accurate and expedited process.
Cold storage stores temperature-sensitive products at low temperatures. Those allow medicines, perishable foods, plants, cosmetics, artwork, and candles to have longer lives. It might include an entire building or even a specific portion of a warehouse that can accommodate these goods.
It is great if you are into perishable business, climate-controlled warehouses are a must to keep your items fresh. It is also attractive for businesses that require certain conditions for rare products, such as artwork or plants, and commonly it is used by pharmaceutical companies.
A growing trend in warehousing is on-demand storage due to online commerce. These warehouses connect businesses with a need for warehouse space (temporary, seasonal, or to handle spikes in sales) with warehouses that have excess space.
This type of warehouse is great for merchants that are willing to combine their inventory needs. Also is great for businesses dealing with a sudden spike in inventory. It is Cost-effective for seasonal or temporary warehousing needs
Also called “customs” warehouses, a bonded warehouse is a type of storage is used to store imported goods before customs duties are levied on them. There are different types of bonded warehouses, facilities tend to be versatile to accommodate a large variety of products.
Bonded warehouses are perfect for importers, as they can keep their goods duty-free even for a long period until they find their customers. Such warehouses play a crucial role in cross-border trade, making them ideal for businesses involved in international trade.
Public warehouses are the ones owned by the government, semi-government bodies, or a third-party. They are rented to private sector companies to stock up on goods upon paying a certain amount of rent.
This type of warehouse is a great option due to its affordability and accessibility, for small businesses and eCommerce startups that are not in a position to own a warehouse and need to store goods for a short time.
Private warehouses are privately owned by large retail companies, wholesalers, manufacturers or distributors that need a significant long-term presence in a specific region. These private companies purchase/manufacture products in bulk for a peak season and store them in the warehouse for the systematic distribution of orders that are bound to come their way.
This kind of warehouse also known as proprietary warehousing, requires capital investments by the owner, hence it’s best for established companies. Although it warrants investment in the beginning it turns out to be exceedingly cost-effective in the long run.
Which Warehouse Is The Best For You?
Each warehouse has a purpose of its own. Whichever warehouse you opt for, ensure to keep both your short-term as well as long-term warehousing needs in mind.
If you need warehousing services, CARGO CARE SERVICES can assist. We specialize in Public Warehouses, Bonded Warehouses, Distribution Centers, and Temperature control storage.
Contact us to learn more about our warehouses nationwide. We offer full-service warehouse management, inventory, and order fulfillment services, that help your business run leaner and more effectively.