Contract warehousing is a third party storage facility that offers specialized storage services. Companies often require such services because they need to store all their goods in one centralized locations. So when the goods need to be transferred to the desired destination, no time is wasted. By warehousing items in a centralized location, companies can reduce transportation costs to a great extent. Moreover, the orders can be processed in the shortest turnaround time.
With the increased warehousing and distribution requirements of different companies, the market has seen the emergence of 3PL logistics and 4-party logistics providers. 3PL firms are ones that provide outsourced logistics services to their customers. Ideally, such a firm would specialize in integrated operation, warehousing and even transportation. Each of these services can be custom-planned to meet customers' requirements, the delivery time frame and the products to be delivered.
Following are some of the advantages of contract warehousing:
• Specialized services: Most companies prefer to outsource their warehousing and distribution requirements instead of investing heavily in the same. By paying a fixed amount of fees, such companies can avail tailor-made solutions related to packaging, cross docking, inventory control and management, transportation and quality control. With a third party to take care of these storage and transport transactions, companies can focus on increasing their productivity.
• Costs: Just as a private warehouse provides storage and warehousing services, a contract warehouse does the same. For a company to set up its own warehousing division, it needs to incur intensive capital investment. The same services can be rented at a fraction of the cost.
• Private services: Private warehouses that offer 3PL logistics offer highly specialized services such as CCTV surveillance, access control and monitored alerts. Most public warehouses do not provide any such services. Private warehouses go out of their way way to ensure that their facilities are actually dust-free. These warehouses also using certified racks to store goods; these racks are certified to more than 7 on the Richter scale. All these precautions ensure that goods remain safe even in the most extreme conditions.
• Suitable for varied businesses: Whether you are a bicycle manufacturer or a medical product dealer, your warehousing and distribution requirements can be met by a contract warehouse. 4PL and 3PL logistics providers make use of the latest IT solutions in order to ship products in the shortest turnaround time. They maintain an error free inventory database which offers a competitive advantage and helps reduce costs.
Here, contract warehousing is a service that does much more than just delivering your products from one place to another. It's a complete solution that helps increase your operational efficiencies.