Meaning of Warehouse, Importance & Types - AVG Logistics

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What is a warehouse?

A warehouse is a storage structure built to protect the quality and quantity of stored products. A warehouse is necessary when there is a time gap between the production and consumption of the products. Warehouses allow entrepreneurs to produce and sell their products throughout the year whenever there is sufficient demand.


Importance of warehouses

Warehouses are primarily used for storing goods. There is also a need for warehouses because some goods are produced only at a certain time of year, but are in demand throughout the year. Similarly, certain products are manufactured throughout the year but are only in demand at a particular time of year. Warehousing is the storage of goods until they are shipped to customers.


Goods must be stored so that they are available to buyers when they need them. Warehousing allows a company to carry out production in anticipation of expected demand. By bridging this gap, warehousing creates a time benefit.


Characteristics of a warehouse

A few key factors for an ideal warehouse are:


1. good location - near airports, train stations, highways, and with ample parking.


2. loading and unloading facility for continuous flow of goods.


 3. Adequate storage space to accommodate goods of different sizes and consumption.


4. cold storage for perishable goods.


5. parking space for means of transportation such as trucks, lorries, railroad wagons, etc. for the transportation of goods.


6. security and protection against fire, theft, etc.


Types of warehouses

There are 5 main types of warehouses:


1. private warehouses.

These are owned and controlled by large producers and distributors to meet their own storage needs.


2. public warehouses

These are specialized business organization that provides storage facilities to the general public for a specified fee. They may be owned and operated by either an individual or a cooperative.


3. duty-free warehouses

They are authorized by the government for the storage of imported goods pending payment of customs duties. They are usually located near ports. They are either controlled by the government or are under the control of the customs authority.


4. cold storage and climate control

These warehouses use special temperature-controlled mechanisms to ensure that goods such as grains, pulses, medicines, flowers, and other perishable items can be stored for longer periods.


5. export & import warehouses

These storage units are usually located in places where many goods flow between countries. They are usually located at international airports, ship docks, near highways, at international borders, etc.

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