What is Contract Warehousing
Contract warehousing is a form of warehousing whereby the customer has signed a contract with a warehouse provider which binds him to use the warehouse services for an agreed period of time (usually in years) and at an agreed cost structure.
Public warehousing is a form of warehousing whereby space is sold or leased out to customers for a period of time as stipulated in their contract. This is often the choice for organisations seeking to take advantage of the cost savings, the bulk of which are renovating of the warehouse, purchasing equipment and staffing.
Differences between Public Warehousing and Contract Warehousing
What are the benefits of using Contract Warehousing?
These are generated from saving the cost of constructing and staffing a private warehouse and also, with a longer bond period, it is often easier to negotiate for better storage rates, hence lowering the costs incurred further.
Storage of more goods
As storage providers are able to spread the cost of procuring the necessary equipment over a longer period of time, they are more capable of storing a wider range of goods.
By having a longer bond period, customers will not face any large fluctuations in storage prices as the cost and increments over the years have already been stated and agreed upon. As such, customers will not face any large spikes in prices due to changing demands for storage area.
Who are these services catered towards?
As such, contract warehousing is usually more suited for individuals or companies that are,
- Seeking a long-term storage facility
- Selling goods which need to be stored under special circumstances
- Looking to stabilise their expenditure
Why choose M&P International Freight?
M&P International Freight is a one-stop shipping solutions freight forwarder company located in Singapore who primed and ready to meet the transportation needs of international clientele.