When setting up your eCommerce business, one question you may ask is, where will I store my goods until they are sold online? There are many types of warehouses that allow you to store the goods that are being sold online, record sales and accurately track the inventory to prevent lost items.
Warehousing is a great option for growing online businesses that have outgrown their current storage facility.
There are many types of warehouses for eCommerce businesses to consider. Such as public, private, bonded, consolidated and smart warehouses.
Warehouse management software systems have many benefits that can elevate eCommerce warehouses with improved customer service, automatic delivery updates, reduced costs and integration through eCommerce platforms such as Amazon, Shopify and eBay.
To learn more about the types of warehouses for eCommerce and what is the best warehouse type for your online eCommerce store, keep reading.
The Five Types of Warehouses for eCommerce
Public warehouses allow businesses to rent inventory space to store and distribute their products.
It is one of the best ways to reduce costs for small, growing businesses as you are renting public space and do not have responsibility for building maintenance or staffing.
With flexible contracts and competitive pricing, public warehouses are appealing to eCommerce businesses looking to expand.
Private warehouses are owned and operated by manufacturers, wholesalers and retailers.
They are a private storage solution where retailers can store and distribute their inventory close by to where they live.
You can choose to rent or purchase a private warehouse and customise the space to fit your brand.
Private warehouses can be costly and sometimes require a big initial investment to get started. However, it is deemed a cost-effective solution in the long run.
A bonded warehouse can also be referred to as a customs warehouse and is used to store products that require duty payments.
Retailers do not have to pay any tax or duty on the products in storage until they are sold which improves the cash flow of eCommerce businesses.
This is a long-term storage solution where your products are kept safe and secure by customs authorities.
Consolidated warehouses are a viable option for eCommerce businesses that receive smaller shipments.
Multiple small shipments from varied suppliers headed toward similar locations can be consolidated to create a larger, and more economical, shipment that is transported to its destination.
There are minimal inventory size requirements and operating costs at consolidated warehouses which makes this an attractive warehousing option for small to medium-sized eCommerce retailers.
Smart warehouses use digital technology to perform operations and tasks that would have previously been completed by a human.
This type of warehouse is an automated storage space that is operated by sorting tools, software systems and unmanned equipment.
With unlimited potential and cutting-edge technology, smart warehouses are an innovative storage solution that focuses on increased accuracy and effectiveness.
For more information about eCommerce warehouse solutions and how your online business may benefit from warehouse management software systems, get in touch today!