Starting Warehousing and Distribution Service
Entrepreneurs find that the warehouse and distribution service is a great way to conduct business. However, in order to start warehousing company, you would need a huge overhead account to buy warehouse property and facilities; people to work in the warehouse industry (most importantly, logistics officers to make sure that operations run as smoothly as possible and machineries to use.
Simply put, a warehouse is a commercial building for the storage of an assortment of goods.
Customs, importers, exporters, manufacturers, transport businesses, and wholesalers use warehouses to store their products. For some entrepreneurs, the warehouse and distribution service is a great way to conduct business, and eventually proves to be a great investment.
Most of your overhead expenses will go into buying, constructing, renting or outfitting a building or several buildings for your use. A warehouse business will not be a warehouse unless there is that physical structure that can hold all the goods, or the “wares,” as they are called. Warehouses need not be acres wide, but spacious enough to hold whatever your customers would want. Some warehouses hold small products: microchips, auto spare parts, etc. Others hold larger products like luxury cars, boiler parts, etc. Some of your customers may be selling small products like light fixtures or bicycle parts, but needs warehousing storage for a huge supply of them.
It might be wise to accommodate customers whose products can fit into your warehouse. Don’t try to take in more than your actual warehouse can handle because it will only disrupt everyone’s operations, including your customers’.
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Also, you should try to find your warehouse(s) location somewhere far from residential areas but near other industrial buildings, or at least, places where your customers can have easy access them. Warehouses are usually large plain buildings equipped with loading docks to load and unload trucks. Depending on what company you are servicing, you may want to find a location near airports, railways or seaports.
Warehouse and distribution companies need a lot of people to work within. Some people will have to be assigned to moving goods, receiving or distributing goods. Logistics officers are essential to this type of business, for they can make operations run as smoothly as possible. It would be unwise to think that only a few workers can make this type of business run without a glitch. Without logistic officers, you would have a difficult time accepting (or picking up) wares, placing them in storage, keeping track of orders for distribution, or releasing orders.
One marketing trend that is happening with great success is doubling warehouses as retail stores, with the larger orders on top of tall shelves and smaller bundles on the lower shelves for the walk-in consumers. Another marketing trend is more geared to Internet subscribers. Small orders are being shipped worldwide from various warehouses. Typically, a couple of companies would order large bulks of materials once per month. These days a large number of individuals and small scale business order smaller quantities of materials from warehouse distributors, but they order more frequently than the larger companies. Depending on how you wish to go about your business, you can either go for the typical supplier-warehouse-consumer deal, warehouse / retail outfit deal, or Internet based consumer distribution system.
In any case, all these involve setting up a distribution system: deliveries should be made either by boat, plane, train or by courier system. Your logistics officers should handle these flawlessly to ensure that deliveries are made on time, and without damage to the goods. It would also be prudent for you, as owner or manager of the warehouse business to get insurances for your company and your consumers, just in case things do not go according to plan.
Lastly, warehouses need hardware and machineries. Tall, sturdy shelves are essential, as with forklifts, trucks and whatnots. Computers are needed to track down services done and deliveries to be made. Electricity will take up most of your utility bills.
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