Understanding Warehouses: Types and Their Functions

Introduction To Warehouse

• Would you like to know What a Warehouse is? A warehouse is a type of commercial building where products are kept for storage. Warehouses are utilized by manufacturers, importers, exporters, wholesalers, transport businesses, customs, etc. They are usually huge plain buildings found in industrial areas of cities and towns.
• The place where goods are kept on a large scale in a systematic manner, can be called Warehousing.
• The person in charge of a warehouse is called a "Warehouse Keeper".
• Warehouse should possess the following characteristics:- 

1. Location
2. Space.

Classification or Types of Warehouse

There are different kinds of warehouses, and they can be categorized as follows:

Types of Warehouse

Public Warehouse

• Used to solve short-term problems.
• Store goods for the general public.
• Available for use by any individual or company needing storage space.
• Usually impose a cost for the usage of the area.
• Anyone can store their goods in it by payment of rent.
• Govt. permission and license are necessary in this case.
• Used by exporters, importers, manufacturers, and govt. agencies.
• Govt. also monitors and regulates its functions and operations.

Private Warehouse

• Owned and operated by private suppliers and distributors.
• The person who can afford money and make a large investment can afford it.
• These are constructed by nearby farmers, wholesalers, and retailers near their business centers.
• Not available for public use.
• Commonly used by manufacturers and retailers.

Government Warehouse

• Operated and owned by central, state govt. and local authorities.
• Both private and govt. enterprise can use this.
• Generally available for small farmers.
• Central Warehousing Corporation of India, Food Corporation of India, State Warehouse Corporation, etc.
• Nominal charge.

Distribution Warehouse

• Distribution warehouse is the connection between suppliers and customers.
• Play a crucial part in the logistics of the supply chain.
• These are not for inventory storage but rather distribution, order fulfillment, and shipment preparation.
• Generally, affordable to use for companies selling to wholesalers. These are located near the market.
• Reducing the amount of money lost on product long-term storage.
• Focus on the rapid movement of goods rather than long-term storage.
• Central hubs for receiving, sorting, and shipping products.

Fulfillment or Consolidation Warehouse

• Consolidated warehouses gather small shipments from multiple suppliers in one area and aggregate them into larger and larger amounts.
• Economically friendly and time-saving.
• Lower shipping costs for warehouse tenants.

Break Bulk Warehouse

• Warehouse that receives the product in bulk and repackages the product based on customer requirements.
• This generally requires the inspection and re-labeling of products.

Storage Warehouse

• Warehouse which stores products for product delivery to a manufacturer or distribution center.
• "Just in time" delivery of the product.
• Located near the production plants and facilities.
• Companies use storage for different requirements like seasonal demand and supply.

Automated Warehouse or Smart Warehouse

• Where AI is used to automate the fulfillment and storage processes using robots and drones.
• These warehouses are a go-to option for large e-commerce companies such as Amazon.
• Utilize technology and automation for efficient storage and retrieval.
• Enhance productivity and reduce human errors.

Climate-Controlled Warehouse

• Designed to store perishable goods that require specific temperature and humidity levels.
• Used for the storage of temperature-sensitive products.
• Such as freezers for storing frozen products, humidity-controlled environments for delicate products, and dirt-free facilities for handling highly sensitive computer products.
• Commonly used for storing food, pharmaceuticals, and chemicals.

Co-Operative Warehouse

• Owned, managed, and controlled by co-operative societies.
• Most economical rates.
• Not to earn profits but to help their members.

Bonded Warehouse

• A common question is, "What is a bonded warehouse?" A Warehouse that stores imported goods before customs duties are completed and the products are paid for can be called a bonded warehouse.
• Companies don't need to pay duties until items are released from storage for delivery.
• Help the govt. to exercise control over private firms and to collect taxes on time.
• Licensed by the government to store imported goods before customs duties are paid.
• Goods can be stored for a specified period without payment of duty.
• Useful for importers who do not have immediate sales.

Conclusion

Each type of warehouse serves distinct purposes and is chosen based on the specific needs of the business or industry.