Warehousing – Types, Functions and Characteristics

A warehouse is a commercial building used for storage of goods while warehousing is the process of proper storage and handling of goods and cargo using scientific methods in the warehouse and making them available conveniently when needed. In in the present day’s scenario, warehousing is considered as one of the crucial essential side of trade.

Need for warehousing

Some commodities are produced in a particular season only. To ensure their off-season availability, warehousing is needed.

Some products are produced all year long but their demand is seasonal. Warehousing is necessary in such cases.

For the companies which opt for massive scale production and bulk provide, warehouse is an unavoidable factor.

Warehousing assist corporations ensure quick provide of products in demand.

Production of goods and their movement of goods are vital for the companies for steady production of goods.

Warehousing can also be essential for value stabilization. For vital goods, the Government stores them in the warehouses and management its supply in the market as per the value fluctuations.

One other important need of warehousing is for bulk breaking. Consider a trade agent who imports goods from a country for a large number of buyers in his own country. He first takes the goods to his warehouse and break it into small parts for provide to the buyers.

When it involves value saving, warehousing helps the traders with cross docking. All the products are consolidated in the warehouse and then stuffed into containers as per their destination. This is very helpful for small traders who export low quantity of goods.

Main functions of a warehouse

Storage of products

Protection of products

Risk bearing



Grading and branding


Types of warehouses

Private Warehouses These are owned by the producers or traders/distributors. Private warehouses are used to store exclusively owned goods. These are normally desirered by farmers close to their fields, wholesalers/distributors/retailers close to their territory, producers near their factories, exporters/importers close to ports. Private warehouses provide better control over movement and storage of goods and less probabilities of error. Alongside with this, product specific storage techniques will be opted in private warehouses. Then again, higher operation prices and inflexibility in storing different products are the major disadvantages of private warehouses

Public Warehouses These warehouses are meant to be used by common public. Anyone can store their goods in public warehouses for a nominal rent. These warehouses might be private or state owned. In case a private company desires to start a public warehouse, it has to compulsorily get hold of a license from the government. Besides this, the operations of those warehouses are additionally regulated by authorities agencies. These warehouses are less expensive and more price effective. They’re versatile sufficient to store completely different kinds of products. Public warehouses supply better utilization of money as the consumer pays only for the area occupied. However public warehouses will not be considered items when it involves such items which require particular dealing with techniques. Also the possibilities of error are more here resulting from common storage of all goods.

Government warehouses The federal government warehouses are owned, managed and ruled by Central or State government. They can be used by both private corporations and government agencies for storage of goods. They are thus also considered a form of public warehouses owned by government. Authorities warehouses offer higher security and safety of products due to high involvement of government. They’re very less costly but require considerable paper work to be done.

Characteristics of a perfect warehouse

It ought to be conveniently positioned close to highways, railway stations, air ports, sea ports etc. for loading and unloading of goods.

Mechanical appliances must be there to lift, load and unload goods.

It needs to be spacious enough.

Meals storage warehouses should have sufficient facilities to prevent meals from perishing.

Proper arrangement to save goods from sunlight, mud, rain, moisture and pests ought to be available.

Adequate parking space ought to be there to facilitate quick and simple loading and unloading of goods.

Security arrangements ought to be strict and round the clock.

Modern and tested firefighting equipment ought to be installed within the premises.

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