If you own or operate a business that manufactures, distributes or sells a physical product, you likely have encountered decisions that need to made regarding storage of materials, finished products intended for sale, equipment, marketing materials and other items related to doing business. For nearly every business, determining how to effectively store all products and materials necessary to operate a business is met with some level of questioning about how to best ensure there is adequate storage space available, including space for future expansion or cyclical selling cycles, while equally ensuring that too large an investment is not made in space that ultimately goes unused.
While there are many businesses that find an effective way to store items without wasting space or money, many other businesses find themselves left with a storage and warehousing dilemma. How am I going to find enough space next year if my business expands? Or what happens if I purchase a large warehouse only to find that sales growth doesn’t continue as expected? In a constantly-changing and often uncertain retail environment, it is often hard to make a long-term commitment to purchasing enough facility space to plan for the future while not biting off more than the company can chew.
One of the most effective solutions to meet a business’s storage and warehousing needs is to utilize the services of an outside company that maintains its own facilities and can provide as little or as much space as the business needs at any time. In doing so, the business can ramp up storage as sales increase or during particularly heavy inventory times of year, while not having to maintain as much space during other times of the year.
In addition to determining how much space is needed to warehouse products and materials for a business, there are other aspects of the process that must be dealt with in one way or another. For example, who will be responsible for maintaining inventory control? Or who will handle the pick-up and transportation of items when they need to be delivered to an end-user, whether the order is a large wholesale order heading to a retail establishment by the pallet or an individual item that is being shipped directly to the consumer?
These aspects of the sales cycle can be handled by company employees if inventory is kept in-house, but just as a company has to balance the space decision so there is adequate space when needed but not too much so that money is wasted, so too must there be a balance as it relates to employees. After all, employee salaries and benefits can add up rather quickly, so a company wants to ensure that there are no employees on the books at times when they are not needed, while equally ensuring that there are enough hands on deck when times warrant it.
Just as the actual storage and warehousing of products and materials can be handled by an outside company, so too can many of the services that might otherwise necessitate the addition of salaried employees. Tasks such as inventory control and distribution can all be run in many cases by the same company that handles a company’s storage needs.
Before purchasing additional facility space or hiring more employees, consider the benefits that can be realized by outsourcing storage and warehousing, as well as other logistics services.