What is contract warehousing and what should you know about it?
Agreements with Contract Warehouses
When you make an agreement with a warehouse to receive, store and ship goods for you and the agreement runs for more than 30 days, that’s contract warehousing in a nutshell. Your contract lays out the terms of service and length of the agreement. Some companies use contract warehousing for a couple months, especially around holiday time, while others can go for many years. Usually, the fee structure is fixed-cost, costs-plus or a combo of the two. Contract warehousing agreements can include services such as handling, packaging, shipping and inventory management.
Contract Warehouses Often Are Centrally Located
Say that you’re a company and you make or order certain items that you then sell to others. Where are you going to put these items? When you want to store items in a central location so they can then get sent out to customers, easily, that’s a good time to utilize contract warehousing services. Rather than build your own warehouse (and staff it), why not lower your overall costs and take advantage of contract warehouses?
Guaranteed Access and Efficient Operations
One of the main reasons companies like contract warehouses is that they’re guaranteed access to a specific amount of storage space each month, such that they’re in control of that space and don’t have to “worry about availability.” This is kind of like having a timeshare versus just trying to rent a hotel room.
Value Added Services
Meanwhile, contract warehouse value-added services can include pallet reworking, pick and pack order fulfillment and quality control checks.
Looking for reliable contract warehousing with a good reputation for keeping goods flowing to and from storage on-time? Contact Affiliated Warehouse Companies at 732-739-2323. Affiliated Warehouse Companies can connect you with contract warehousing in the U.S., Canada, Mexico and Puerto Rico.
