Explain types of warehouses.
Answers
There are 8 types of warehouses you should know when looking for warehousing for your eCommerce business. Learn more about the different types here.
1. Public Warehouses
Public warehouses are owned by governmental bodies and made available to private sector companies.
Public warehouses can be lent for both business and personal use. If you’re an SMB owner and want to store your goods for a short period of time, a public warehouse can be a great option.
Although typically not that advanced technologically, they’re generally the most affordable and accessible option and thus a solid choice for eCommerce startups and SMBs.
2. Private Warehouses
A private warehouse is a warehouse which is privately owned by wholesalers, distributors or manufacturers. Large retail and online marketplaces also have their own privately-owned warehouses.
Although generally more expensive than public warehouses, private warehouses can still be a great option for eCommerce SMBs if they need a major, long-term strategic presence in an important region.
3. Bonded Warehouses
A bonded warehouse is a type of warehouse that can store imported goods before customs duties are required to be paid on them. Authorities give companies using them bonds when they rent space with them to ensure they don’t face monetary loss at the time their products are released.
Plus, companies storing goods in them don't have to pay any duties until their items are released. You can also store restricted items in them until their proper paperwork is complete. A bonded warehouse also offers facilities to store items for extended periods of time.
4. Smart Warehouses
A smart warehouse is a type of warehouse where the storage, fulfillment process and management is automated with AI. Automation typically includes everything from software for management to robots and drones performing tasks like packing, weighing, transporting and storing goods.
Corporations like Amazon and Alibaba use huge smart warehouses that make the order fulfillment quick and less prone to human error.
5. Consolidated Warehouses
A consolidated warehouse is another type of warehouse that takes small shipments from different suppliers and groups them together into larger shipments before distributing them to buyers. The catch is that all the shipments are intended for the same geographical location.
Overall, though, consolidated warehouses are a very economical way of order fulfillment, especially for small businesses and new startups.
6. Cooperative Warehouses
A cooperative warehouse is a warehouse which is owned and run by cooperative organizations like a farmer or winery co-op. Both co-op members and those outside the co-op can store goods at these facilities, though co-op members benefit from reduced rates.
7. Government Warehouses
These warehouses are directly owned and controlled by the government, such as seaport storage facilities.
Typically, government warehouses charge fairly affordable rates. However, if a business is unable to pay their rent within the due time, the government has the authority to recover their rent by disposing of their goods.
8. Distribution Centers
A distribution center is a storage space which is usually built with specific requirements in mind.
The storage is used for temporary needs and items are shifted quickly within the supply chain. A large inventory is received and distributed to resellers and retailers within a short period of time.
In the case of some food and perishable items, distribution centers items are often distributed within a day.