Every business cannot do everything on its own. Thus the business needs to outsource services like warehousing to vendors and this turns out to be cost effective and also saves on time and energy which can be further utilized to focus on customer satisfaction and business expansion.
Operating a warehouse is an expensive proposition. There are many expenses involved in operating a warehouse. You need to have all the equipment like fork lifts, storage racks, safety equipment and many other things maintained and serviced. Also there is a continuous need for investing in purchase, upgrade and maintain the assets.
Also there are many labor issues which the company has to handle and thus if a company operates a private warehouse it will be very expensive and not a good idea as it does not make business sense.
On the other hand Public warehouses have all the equipment, infrastructure and employees ready to handle all your warehousing needs. Also there is almost no capital investment and thus you can maximize profits and save on costs.
In todays dynamic business scenario outsourcing is the only thing which makes complete sense as far as warehousing is concerned as operating a private warehouse is expensive and a waste of time, energy and money.
If you have your own warehouse then you will have to pay large amounts as property tax. This is an expensive proposition as the tax is very high and it will directly impact your operating costs and also your working capital. This is one major and big drawbacks for going for your own private warehouse.
Also there are also many other legal complications and dealings which have to be done on a frequent basis with government officials and tax authorities and this makes operating private warehouses cumbersome and a tough task to handle.
On the other hand with Public Warehouses the tenant does not have to worry about taxes such as property tax and other taxes as they are taken care of by the Public Warehouse operators. Thus the business can focus on its core competencies and can expand their business without wasting time, money and resources on managing a private warehouse.
Operating a private warehouse is a full time affair and thus it requires time, money and energy to operate a private warehouse. A good business focuses on its core competencies and outsources all the other aspects to outside vendors.
This is true for Warehouse and distribution services as well. Operating a private warehouse is an expensive proposition and thus it makes complete sense to go for a Public warehouse as they have the experience and expertise of warehousing and distribution and they can handle these tasks for you at a very low cost as compared to if you were running a private warehouse.
Business is all about the most efficient allocation of resources and the best utilization of resources and to maximize profits and minimize costs companies and business should go for Public warehouses as ll aspects like maintenance, tax liability, workforce and purchase of equipment are handled by the warehouse operators and the business is able to take the warehousing services at a margin of the cost which they would have to invest if they went for a private warehouse.
Thus be it saving money or utilizing expertize or efficient utilization of resources, all these are possible only if the business goes with Public Warehouses.
If a business has a private warehouse then it has to deal with many aspects of the warehouse. Also if the business wants to shift to a new geographical location, this becomes cumbersome and a very time consuming process as the business will have to first find a buyer for their warehouse and then go and purchase a new warehouse and this is not an easy thing to do as the buyers for warehouses are difficult to come. Thus in a private warehouse is a lack of flexibility especially if the business wants to change its geographical location.
In a Public warehouse things are different. You can end your contract anytime you wnt by giving a 30 to 60 days notice and then can shift your operations to the new warehouse in the new location.
Thus as we can see there is tremendous flexibility in a Public warehouse as compared to a private warehouse and thus it makes total business sense to go for a public warehouse as you will end up saving a lot of trouble buying and selling the warehouse and you can easily shift from one location to another without much difficulty or inconvenience.
While owning a Private Warehouse you will have to take care of private warehouse, inventory control, sorting, packaging, shipping and receiving and many more operations. Now the staff should be well trained for all these operations to ensure quality and compliance. In a private warehouse all these things has to be managed by the business and thus the business ends up wasting resources and valuable time which they could have invested in improving the product and also in delighting their customers and buyers.
In a Public warehouse all these aspects of running the warehouse are carried out by the warehouse operators. Thus you don’t have to waste precious time and resources on training and other activities and thus can focus on their core competencies.
Thus as we can see that Public warehouses are much more better and economical than private warehouses and also help the business focus on customer delight and cost saving and make business sense from all angles.
Thus going for a Public warehouse will help the business outsource all its warehousing and distribution operations which can be effectively and efficiently handled by the third party warehouse provider.
Also it offers flexibility in case the business wants to change locations or enter into new geographical territories. Also the business saves on overheads and tax liabilities which make public warehouses the best option for all business- Big or Small.
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