What is Warehousing?
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Warehousing is the process of storing goods to be sold or distributed. When you are starting an e-commerce business, you might use a spare room, garage, or temporary storage as your warehousing. However, with scale, businesses usually use warehouses to safely and securely store products in a more complex and organized manner to track the location, timing, and number of items being stored. Warehouses are buildings or locations specifically built to function as a warehouse facility with a proper warehouse management system.
Warehousing is the process of storing physical goods before they are sold or further distributed. Warehouses safely and securely store products in an organized way to track where items are located, when they arrived, how long they have been there, and the quantity on hand. There are many types of warehousing, which we’ll touch on later.
Are warehousing and third-party logistics (3PL) the same?
Sort of. Warehousing is one of the functions of a third-party logistics partner. Third-party logistics (3PL) is the outsourcing of logistics to a provider. A 3PL will handle order fulfillment services for you, which includes warehousing products to fulfill those orders.
What is the difference between warehousing and a distribution center?
These are often used interchangeably. Warehousing is more focused on the storage function, which a distribution center also does. However, the distribution center also performs order fulfillment on top of storing products. To put it simply, not all warehouses are distribution centers, but all distribution centers are warehouses.
Types of warehousing
There are many kinds of warehouses. Some of those are:
- Private Warehousing - owned by a private entity and used either for their own inventory or could be used by a third-party logistic provider
- Public Warehousing - owned by the government and used for storing their own inventory
- Cold Storage Warehousing - used for storing inventory that requires specific temperatures, like food storage or medicine storage