Warehousing refers to the storage of goods until the time it is needed. In economics, one of the key determinants of supply is the supply of stocks. In this context, companies would be able to build up their stocks in their respective warehouses. As these stocks are being built up, companies would be in a much better position to react to changes in the market accordingly. However, in a land constrained country like Singapore, companies may find that it is not cost effective to afford their own in-house warehousing within their companies. Hence renting a storage space in logistics or warehousing companies would be the way to go.
How is warehousing done?
The key factor in warehouse operations is efficiency. This is to ensure that stocks arrive at their customers’ destinations on time, prevent orders from getting lost in transit. Thus the following factors are essential to operations in a warehouse:
Some warehouses with low ceilings will choose to maximize the space on the floor by lining up pallets in rows and stacking pallets of goods on top of one another. This is effective for storing many pallets of the same type of product.
This method is a more widely accepted method for warehouses with high ceilings as multiple racks can be made to store pallets of goods. At the same time, the shelves can be used to easily categorize the goods accordingly. Some examples could be:
- Short term VS Long term
- Types of goods
- Goods from the same company
Thus, this is relatively more efficient way than bulk storage.
Systematic packing systems
Bulky and Large goods
For these goods, it is pretty straightforward as bigger goods are easier to pack onto pallets and stored in the respective shelves using forklifts or other automated packing systems.
Loose and Small items
Most warehousing and shipping companies will gather similar loose items and make a list of them, followed by packing them into a single carton to be stored away along with the bigger goods. Before doing this, there will be a checker who will account for all the loose items and ensure that these loose items are secured before packing them in.
Central management system
In most warehousing companies, there is a small office located in the warehouse and that office comprises a management team to oversee the smooth everyday operations. With the ground crew running the daily ground operations, this team will be overlooking the bigger picture and prepare for possible logjams and inform the crew on the ground.
Minimizing human error
No human is perfect and we are bound to make errors when accounting for stores and at the same time, slow down movement of goods when manual labour is utilized. Hence, most modern warehouses would introduce automated picking, packing and shipping as machines can be made to perfect operations.
Benefits of Using Warehouse Services
Should I rent a warehouse space?
You have just started up not long ago and you are unsure whether your current location will serve your needs in the many years to come. Considerations like your projections on the space required are still in progress or you will be expecting your target market to shift in the future can lead you to be unsure. Hence, leasing a temporary space in a warehouse would be a wise decision.
If your business involves consistent heavy inflow and outflow of stocks, you could consider investing in your own in-house warehouse. However, if you have recently just started your business, perhaps you do not have the capital to afford a larger complex or the credit rating to afford a mortgage yet, leasing a warehouse space could be a possible interim solution for you.
At the same time, you might want to consider whether the property taxes and maintenance costs to run your own warehouse is greater than that of engaging a freight forwarder doing warehousing solutions. If it is greater, leasing a warehouse space would be the way to go.
For businesses in which these are not your core competency, you would be outmatched by the systems of that of the commercial warehousing companies. Their systems are fully automated and they specialize in the field of logistical deliveries. By engaging their service, this would give you the edge in the market as your delivery speed will be up several notches.