June 8, 2020

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Why Warehousing and Logistic Plays A Vital Role?

4 min read

Warehousing logistics implies the physical distribution of a warehouse. Many companies deal with warehousing, as well as delivery. These companies are committed to providing value-based warehouse solutions that are tailored to the specific supply of chain processes. These organizations can easily change the warehouse into a source of value that can accentuate your business.  

Warehousing Is Essential for Supply Chain

It is considered to be the brain of the supply chain. Warehousing Logistics is a vital and decisive component of an effective overall supply chain management systems solution. Logistics operations must remain competitive. 

The warehouse offers a storage system to online product selling companies. At these storage points, the e-commerce companies can store the raw material and finished product as well.  

The warehouse system helps in the optimum utility of raw materials, industrial raw material, and final products. 

The warehousing system that is efficiently maintained can help the customers to deliver the products to the final destination. The warehousing system is going to be more important for companies to maintain customer satisfaction and trust in your company. 

The warehousing system helps to decrease the gap between demand and supply. Also, allow the manufacturer to increase their production significantly and manage to fulfill the growing demands of customers. 

Strategic Warehousing

Strategic Warehousing Logistics planning permits the organization to align the operations with overall business objectives. This helps it to be equipped to meet technology changes, globalization, and the demands of a more interactive supplier community. 

Strategies in warehousing logistics include inventory management, production scheduling, transportation, and organizational communications. These can create an optimized distribution network and competitive advantages.

Such a network has various objectives such as, speeding the supply of the products and thereby, speeding the cash flow. It also helps to ensure a high level of growth in the revenue for all the companies involved in the chain. It enhances customer loyalty through commitment and competence. 

It helps to keep costs as low as possible while maintaining excellent customer service. The strategic warehousing will reduce the expenditure and increase the profit significantly. It is very important to think about different ways for optimum warehouse management. 

The alternative to Just in Time Manufacturing

Some companies that want to increase efficiency and bring down costs are considering the just-in-time (JIT) manufacturing system to accomplish their goals. Though this system offers various advantages concerning inventory, it also poses risk to the inventory. This risk can lead to a bad impact on operations and sales. 

There is one alternative to the Just in Time manufacturing companies is warehousing. The warehousing and order fulfillment center help in reducing the gap between demand and supply. There are two ways to maintain a storage system. These two ways are: in-house warehousing and outsource warehousing system. 

It allows the manufacturer to store its product until the order placed by the customers. When an order is placed, then the specific product is shipped to the consumer destination. While it seems like a promising concept, JIT doesn’t come without limitations. All processes in the JIT system are interdependent. 

Thus, a chink in one aspect of operations can cause the entire system to grind to a halt. For example, should delivery of raw materials or parts fail to arrive due to an accident or disaster, a company will have to close down its assembly line while waiting for the next shipment. 

Even a few days of delay can cost companies a significant amount of sales. And because a company employing the JIT system will typically have eliminated its warehousing and fulfillment components, this means it won’t have available stocks to fall back on should this occur.

Outsource Warehousing System

Companies can still achieve their goals of bringing down costs and maintaining efficiency without compromising their supply chain by outsourcing warehousing and fulfillment. Enlisting a third-party logistics provider not only eliminates the need for additional space, equipment, and manpower but also allows companies to access expertise and technology otherwise unavailable to them at a significantly lower cost.

3PL Warehousing Service Providers 

Third parties that offer warehousing and fulfillment services will typically be able to provide just the services a company needs. These services cover various aspects of the supply chain, including but not limited to inventory management; assembly; pick, pack, and ship services; and automated packaging.

Those that use the latest technology can even go beyond simply providing warehousing and fulfillment. Using the latest technology, they can integrate their systems with client websites to begin processing the order as soon as each transaction is made. 

Some solutions may also allow them to better process bulk or internal orders. Unlike the JIT system, outsourcing warehousing and fulfillment not only helps to streamline operations; with the right service provider, it can also add value to the entire operation.

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