As the world continues to adopt a digital-first approach, the need to eCommerce warehouses has seen a rapid increase in recent years. eCommerce warehouses operate by storing physical goods before they are sold online, but with such a diverse range of businesses and services now selling goods, there is now an equally diverse range of warehouse types, each with its own benefits and functionalities.
In this guide to eCommerce warehouses, we will look closer at the benefits of eCommerce warehousing, the different kinds you may find, and how Optima can help support you in your eCommerce journey.
What is eCommerce warehousing?
eCommerce warehousing refers to specialised warehouse facilities that store and process physical goods to be sold online. The term ‘warehousing’ also refers to the processes involved in eCommerce warehouse management and operations, including inventory management, order fulfilment, delivery, employee management and forecasting.
eCommerce warehouse types
eCommerce warehouse types can vary depending on a business’ storage requirements. Large-scale, international organisations will have vastly different needs than that of a start-up or traditional smaller-scale brick-and-mortar store, so it’s important to understand which eCommerce type is right for your business.
Smart warehouses operate by integrating cutting-edge technology like IoT (Internet of Things), AI (Artificial Intelligence), and automation. Automated systems for inventory tracking, robotic picking, and predictive analytics help to improve efficiency when it comes to managing inventory, leading to faster order processing and reduced operational costs.
Operated and managed by government bodies, these warehouses tend to offer more affordable rates to businesses while also offering enhanced security, making them popular with businesses looking to store high-value eCommerce products.
Public warehouses are also owned by government bodies and offer rented space out to businesses. While often less technologically advanced than private warehouses, public warehouses are a popular option for short-term storage or eCommerce start-ups as they offer more affordable rates.
Owned and operated by individual companies, private warehouses provide exclusive storage and distribution facilities dedicated solely to their products. This type of warehouse grants businesses complete control over operations, allowing for tailored processes and security measures aligned with their specific requirements, and are more expensive to purchase or rent than public warehouses.
Consolidated warehouses bring together products from different suppliers into a single storage facility, grouping them into larger shipments before they are distributed to buyers in a similar geographic location.
Cooperative warehouses are shared spaces collectively owned and operated by a group of businesses. They often work in similar sectors or supply similar products that require similar storage needs. Sharing a storage facility allows each member to pay a partial amount of the overall warehouse fee.
Bonded warehouses are government-owned facilities that are specifically built to store imported goods before customs duties or taxes are paid. Customs authorities manage and supervise these warehouses and issue “bonds” after the business begins to rent the warehouse, as proof that the business is storing goods within the space. Bonded warehouses are particularly useful for eCommerce businesses dealing with international shipments, providing flexibility in managing cash flow.
Benefits of eCommerce warehousing
Efficient eCommerce warehousing unlocks a wide range of benefits for warehouse businesses of all shapes and sizes. Some of these benefits include:
- Optimised inventory management
- Enhanced order accuracy
- Expedited order processing
- Reduced shipping times
- Improved customer satisfaction
- Cost savings through streamlined operations and reduced errors.
How Optima will help
At Optima, we understand the importance of warehousing for your eCommerce business. Our comprehensive and flexible warehouse management solutions harness the latest technology and industry expertise to optimise your eCommerce warehousing operations.
Get in touch today to find out more.