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Why you need warehousing and distribution services?

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The importance of warehousing and distribution services is known to many. One cannot even imagine logistic operations without this service.

What is warehousing and distribution service?

A warehouse is a place where goods are stored safely for distribution or use. Warehousing and distribution services are the key part of 3PL. These services are important for companies to manage their business operations effectively. They are the pillar of supply chain management and offer many benefits to companies.


Benefits of warehousing and distribution services

1.   Can aid in expansion: When the manufacturer outsources the storage and distribution services they are able to concentrate on more key aspects of their business that also includes expansion. The space that was used for goods storage can be used for other key aspects like product development, process improvement, and more when warehousing and distribution services are outsourced to a professional service provider.

 

2.   Beyond core functions: The storage and distribution services go beyond the core basic function which is the storage of the goods. The professional service providers also effectively handle inventory management that includes picking the products from their initial point, packing, and shipping them.


Stabilize the price: The warehousing and distribution services help in stabilizing the price. An uninterrupted supply of goods is maintained by storing the goods when the supply is more and then releasing the same goods when the demand is more than the supply.

 

4.  Minimize the business risks: Goods kept in the warehouse are insured at the risk of the warehouse owner. It becomes the responsibility of the service provider to protect the goods from all kinds of risks like theft, fire, or damage. The risk of damage to the goods stored in the warehouse will be shifted to the service provider who will be responsible for any loss and will be paying the compensation.

 

5.   Access to modern solutions: For many small businesses lack of funding makes it impossible to invest in modern technological solutions. A warehouse and distribution service provider incorporates radio frequency identification and inventory tracking methods to meet customer demands, thus giving businesses a competitive-edge.

 

6.  Low capital expenditure: Investing in a warehouse space and infrastructure needs large capital investment and this can create financial instability for many businesses as they may need the funds for expansion and investment. Outsourcing warehousing and distribution services to the third party the risk of blocking the capital is reduced, allowing the companies to expand and grow.

 

7.   Experience and expertise: A dedicated and professional warehousing and distribution service provider will have in-depth industry know-how and proven process and this can benefit the businesses in a great manner.

 

Wrap up

In a nutshell, for companies that require warehousing and distribution services, outsourcing to a professional 3PL service provider makes good sense. This will allow the businesses ability to manage inventory, combine shipments, and keep more capital on hand so that they can continue to scale through and satisfy their customers. 

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