Warehouses are expensive for companies to operate. The cost of the land, building, machinery, labour and the items stored in the warehouse can amount to a significant sum of money. Most companies would like to maximize the operation of the warehouse, either by streamlining the placement and picking of goods, reducing the time goods are stored in the warehouse, or automating as much as possible to minimize labour costs, while improving accuracy.
Companies can also reduce their costs and improve the efficiency of their warehouse by maximizing the space utilization, ensuring that it is possible to store as many items as possible in the most optimum space.
However, for most warehouse operators, there is always vacant, underutilized storage spaces available in their warehouses. Companies who own warehouses evaluate the estimated storage space which they require or would require when setting up these storage facilities. The hefty ambition of companies will always have them with a storage volume greater than reality. Many a time, warehouse operators find shelves, racks, and pallets collecting dust due to its underutilization.
A Growing Trend on Maximising the Usage of Stage Spaces
As the costs included in operating and set up of a warehouse of of great margins, business owners who choose to have their own storage facility can only afford to have a limited number of distribution centres and fulfilment centres. This opened up an opportunity for existing warehouse owners to open their doors to other merchants who wish to rent their underutilized space. Hence, the way forward was through on-demand warehousing. On-demand warehousing provides warehouse owners with an outlet to increase their revenue by renting out their unused spaces.
Benefits of Renting Out Unused Storage Space
By allowing other businesses to use their idle warehouse storage space, warehouse owners are able to maximise the use of their investment while earning additional revenue. During peak seasons, businesses are constantly flooded with an overflow of inventory. The volume of goods on hand surpass their storage capacities. During this time, businesses can turn to you, the warehouse operators and owners to rescue them from this turmoil.
As warehousing is a business as itself, allowing other businesses to use your space increases the credibility of your company. Over time, as more and more businesses rent your vacant storage space, the more trust is earned by your business in the market. This can prove a driving factor to the growth of your warehousing business. Furthermore, you as a warehouse operator is able to offset your monthly expenses considerably due to the additional income received from these newly added services you provide.
Another aspect to look at it is that e-Commerce has single handedly shaken retail logistics operations. There’s no longer the one-size-fits-all warehouse solution. Fulfilment boils down to accurate demand forecasting, or how best to move inventory towards customers, and also reverse logistics, or how best to manage returns and edit inventory. Strategy involves scalable warehouse facilities ranging in size, services, proximity to population, and length of operation. Ultimately, it all comes down to optimizing the last mile of delivery. And you will have the opportunity to play a major part.
Simply put, for last-mile-delivery to be at its finest, e-commerce merchants need to own or have access to fulfilment centres located near their customers and in the case of e-commerce, is worldwide. By having access to distribution and fulfilment centres across the country and out of the country, merchants can fulfil customer expectations of quick delivery. That ultimately boosts the demand for your warehousing services.