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Warehousing – Types, Functions and Characteristics

A warehouse is a commercial building used for storage of goods while warehousing is the process of proper storage and dealing with of goods and cargo utilizing scientific methods in the warehouse and making them available conveniently when needed. In immediately’s scenario, warehousing is considered as one of the crucial important side of trade.

Want for warehousing

Some commodities are produced in a particular season only. To ensure their low season availability, warehousing is needed.

Some products are produced all year long but their demand is seasonal. Warehousing is necessary in such cases.

For the businesses which opt for giant scale production and bulk supply, warehouse is an unavoidable factor.

Warehousing help firms guarantee quick provide of goods in demand.

Production of goods and their movement of products are important for the businesses for continuous production of goods.

Warehousing is also essential for value stabilization. For necessary goods, the Authorities stores them in the warehouses and control its provide in the market as per the value fluctuations.

Another necessary need of warehousing is for bulk breaking. Consider a trade agent who imports items from a country for a big number of buyers in his own country. He first takes the products to his warehouse and break it into small parts for provide to the buyers.

When it comes to value saving, warehousing helps the traders with cross docking. All the products are consolidated within the warehouse after which stuffed into containers as per their destination. This is especially beneficial for small traders who export low quantity of goods.

Main features of a warehouse

Storage of goods

Protection of goods

Risk bearing



Grading and branding


Types of warehouses

Private Warehouses These are owned by the producers or traders/distributors. Private warehouses are used to store completely owned goods. These are usually preferred by farmers close to their fields, wholesalers/distributors/retailers close to their territory, producers close to their factories, exporters/importers close to ports. Private warehouses offer higher management over movement and storage of goods and less probabilities of error. Alongside with this, product specific storage methods will be opted in private warehouses. However, higher operation prices and inflexibility in storing completely different products are the major disadvantages of private warehouses

Public Warehouses These warehouses are meant to be used by common public. Anyone can store their items in public warehouses for a nominal rent. These warehouses could be private or state owned. In case a private company needs to start a public warehouse, it has to compulsorily acquire a license from the government. Besides this, the operations of these warehouses are also regulated by authorities agencies. These warehouses are less expensive and more value effective. They’re versatile sufficient to store different kinds of products. Public warehouses provide better utilization of money as the consumer pays only for the space occupied. However public warehouses are not considered goods when it comes to such items which require particular handling techniques. Additionally the probabilities of error are more here as a result of frequent storage of all goods.

Authorities warehouses The federal government warehouses are owned, managed and governed by Central or State government. They can be utilized by both private corporations and authorities companies for storage of goods. They’re thus also considered a form of public warehouses owned by government. Government warehouses supply better security and safety of goods as a consequence of high involvement of government. They’re very less costly however require considerable paper work to be done.

Characteristics of an excellent warehouse

It ought to be conveniently situated close to highways, railway stations, air ports, sea ports etc. for loading and unloading of goods.

Mechanical home equipment should be there to lift, load and unload goods.

It should be spacious enough.

Food storage warehouses should have enough facilities to prevent food from perishing.

Proper arrangement to save lots of goods from sunlight, mud, rain, moisture and pests should be available.

Sufficient parking space needs to be there to facilitate quick and simple loading and unloading of goods.

Security arrangements should be strict and around the clock.

Trendy and tested firecombating equipment ought to be installed in the premises.

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