The Role Business Warehousing Plays in a Company

Old warehouses in Amsterdam, the Netherlands

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For probably at least the past two centuries there has been the need for business warehousing in some capacity. Even when farming was the role of more families than it is today there was a need for some products though on a smaller scale than there is today.

The small country store still relied on the production of the products they had to sell to the local communities they served, and those products needed a place to remain until they were ready for distribution to consumers.

The role of business warehousing may have changed over the centuries but it has not in any way been diminished. With the Internet paving the way for more direct-to-consumer distribution, the need for small local business warehousing functions has diminished, but the role of fulfillment centers and business warehousing in general remains the same.

Even though more business and residential consumers are buying directly from manufacturers or wholesalers, there is still the need for fulfillment functions. This also means there remains a need for efficient inventory management to allow the vendors to maintain control over what they have available to ship to their customers.

As we move more into the 21st century and companies work toward cutting back on costs, they will certainly make changes in business warehousing. At the same time they will not be able to eliminate this function completely–it is a primary function of anyone in a sales environment. As much as we would like to think we can reach the point of only having products on hand as we need them to ship to customers, that will not happen. There will always need to maintain business warehousing functions in order to accommodate those customers who may discover they need something quickly because they have received a last minute order from a customer.

While publishers have started to learn more toward only printing books as orders come in (print-on-demand technology), not everyone has the capability to do that. For instance, if a company needs lead time to make a product, they certainly cannot eliminate business warehousing functions an only make enough product to suit current demands. Therefore, if they are not going to maintain their own warehouse, it is essential for them to outsource business warehousing functions in order to maintain inventory management and be able to fulfill the needs of their customers. Inability to meet customer demands will drive those customers to competitors.