The Many Advantages to Leasing Third-Party Warehouse Space

4 Key Factors To Successful Record Label Management
November 8, 2016
A Study of Organized Retailing in India
November 11, 2016
Show all

The Many Advantages to Leasing Third-Party Warehouse Space

Outsourcing is becoming a popular tool for running a business. Companies outsource a number of the services formerly performed by internal departments. Some examples of the departments whose work is outsourced might be human resources and payroll, the IT department, and some manufacturing. There is one service that you might not immediately think of. This is your warehousing. On the West Coast, a Los Angeles Contract Warehouse can make your company more efficient and can save you money. Whether you are in New York or Los Angeles 3PL (third-party logistics) is something you should consider.

One of the most compelling reasons to use a contract warehouse is that it gives you more flexibility. Even if your company owns and runs its own warehouses, you may have some times of the year when you have extra inventory that you need to store. If you did not have a contract warehouse available to you, you would need to have excess warehouse space that would just sit empty for most of the year. The rule that time equals space equals money tells us that owning warehouse space that will spend time empty is wasteful of scarce resources. Carrying this idea forward, you can see that the less space you own and the more you lease can increase your efficiency.

When you decide to lease contract warehouse space, you need to consider the characteristics and features of the space as you make your decision. While important in every location, in the Los Angeles area, an important consideration is whether the warehouse is on stabilized ground. This characteristic is even more important if the inventory to be stored consists of oil field equipment or heavy equipment of other types. Other characteristics to look for are high ceilings to allow for high rack storage, a dry and well-insulated building to protect weather-vulnerable inventory, and a location that is convenient to a highway so that the transport truck can get the goods to their destination quickly.

The next area to consider after the physical building is the warehouse personnel. In your own warehouse, you have the responsibility for training, managing, and paying the warehouse workers. By contrast, the staff and management of the contract warehouse have specialized training and only one goal, which is efficiently and safely handling your goods. This leaves you and your company the capacity to excel at your core competencies.

A final consideration is your ability to keep in touch with your inventory. If you work with a progressive, high-tech warehouse, they will have a web-enabled tracking system. Using this system, you should be able to access your inventory information online so that, at any moment, you can check for yourself the quantities and locations of your inventory. This system eliminates the chance that you will spend time on hold while someone else checks your information.

As you can see, third-party logistics is an important consideration in determining your storage solutions. The three areas that you need to investigate in making your selection is the quality of the physical building, the reliability and knowledgability of the staff, and the convenience of online access.

Comments are closed.