Do you know how to select the right warehouse for your business and maximize savings? Warehousing is a necessary component of the customer journey and can be interpreted as an investment. If you’re looking to save on costs and boost your productivity, know that a well-run warehouse can give you better control over your inventory and ensure customers receive their orders on time.
But when it comes to selecting the right warehouse for your business, no one size fits all, so you need to consider factors such as proximity to suppliers and customers, cost optimization, technological capabilities, space utilization, and scalability, to name a few. With careful planning – which often requires help from external logistics specialists – you’ll have more success determining the right warehouse for your needs.
Choosing a Warehouse Location
How to select the right warehouse location for your business can be quite a puzzle. You want to find one close to major highways, convenient for customers, employees, suppliers, and vendors— yet cost remains a key factor. Do you opt for the warehouse near a densely populated area or the one further away with cheaper real estate? And don’t forget about labor costs—will you be able to find qualified staff in this location? Luckily, you have all the tools at hand to solve this logistics riddle of success!
Where Are Your Customers?
Before you can assume your spot as an industry titan, you must understand where your potential and current customers are. Ask yourself the tough questions: Do our sales primarily target people within a specific region? Are we selling all over the world? Taking an inventory of the customer landscape is vital for maximizing efficiency—setting up a shop near your customers helps keep transportation costs down, streamlines delivery, and saves resources in the long run. Ready, set, map!
Are You Getting Value For Your Money?
When selecting the ideal location for a warehouse, the cost is always at the top of the list. But to get a true sense of value for money, it’s essential not to overlook hidden charges — a factor that can offset any savings you make on cheaper rental rates.
Luckily, there’s more than meets the eye when making your decision; tax structure and incentives are also vital considerations. Certain areas may be subject to special government programs designed to boost particular industries. All in all, weighing up all this information is an absolute must if you’re looking to get the most bang for your buck!
What Are the Utility Costs?
Whether you’re growing or shrinking, it pays to do your research to avoid making a potentially costly mistake. When planning your move, remember to factor in all the utilities necessary for smooth operation: electricity, water, and sewage are standard, but what about the internet? Before you move, double-check the availability and cost of the internet; after all, fast and reliable service is essential in this day and age!
What is the Structure and Layout of the Building?
Choosing a suitable warehouse building for your business requires a lot of thought and consideration; after all, it might be challenging to adjust specific equipment to an old building that cannot sustain a proper flow of raw materials. It could also result in needing to modify an existing warehouse and that could lead to additional costs.
Thinking about ceiling heights, column spacing, and other factors is key in ensuring that you will avoid any issues with inward and outward flows. Do you sell perishables that need to be refrigerated? Be sure to look at refrigerated warehouses to ensure frozen or perishable goods are stored correctly and arrive in top condition!
To guarantee your buildings are fit-for-purpose, put as much time and effort into the structural planning as you would the other aspects of planning – otherwise, you may discover too late that essential elements have been missed or overlooked.
What is the Workforce Availability in the Area?
Despite the great potential for cost savings, it’s important to remember that workforce availability means more than hiring bodies at low wages. You must look at the big picture regarding supply and demand and consider whether these workers have the desired skills to meet your business’s needs. If not, you could find yourself with a team lacking in drive to give your customers the service they deserve while wondering how much money you wasted in the process.
Is the Warehouse Close to Airports, Railways, or Ports?
Regarding transportation costs, there’s a lot to consider – from where your business is located in relation to roads, highways, and airports to the volume of local traffic. If trucking is your primary mode of getting products around, accessibility and easy access are key. It pays well then to be mindful of proximity when selecting warehousing facilities – ideally as close as possible to the airports, railway stations, and ports for maximum drayage cost control and high-velocity levels.
What are Some Local Environment Factors?
When considering an optimal location for a new warehouse, you’d be wise to look at two key factors: proximity to major suppliers, producers, and/or customers, plus local environmental considerations. Logistics pros and cons can quickly outweigh each other based on these locality choices, so getting it right is vital.
Make sure you pay attention to weather risks just because the building looks great – would you want a hurricane tearing through your new facility? When it comes to markets and local environmental factors, go the extra mile in your due diligence!
Factors to Consider When Selecting a Warehouse
It takes significant research and internal evaluation of company priorities to select the correct warehouse. Here are some considerations to keep in mind when choosing your next warehouse.
Special Features
It is not uncommon for warehouse features to be as unique as the inventory. Ensure your warehouse has everything you need for storing your products, like dock doors, levelers, fire suppression systems, refrigeration or air conditioning, power requirements, and floor loading capabilities.
Technology
Typically, warehouses are not equipped with technology before leasing or purchasing; the tenant’s needs determine it.
When selecting a warehouse, consider the following questions related to warehousing technology:
- How will the new warehouse integrate with your company’s existing supply chain and processing systems?
- Does the warehouse already have any tech?
- Does the warehouse have the capacity to handle new technologies such as drones, pick-by-vision systems, and electronic data exchange?
Flexibility
The COVID-19 pandemic clearly illustrates that eCommerce services need to be more flexible. It would help if you chose a warehouse that will be flexible enough to expand and meet the logistics requirements of the future (and those of your customers).
Pick Your Warehouse Like You’d Pick a Date
With eCommerce playing a more significant role in the consumer market than ever, an efficient warehouse solution is essential. Don’t just click and go when selecting your warehouse logistics; read up on implementation strategies, scalability potential, and reporting capabilities for that extra peace of mind. After all, your warehouse may be the basis for your eCommerce business, so don’t view it as an afterthought – treat it with respect! Pick the best service that fits your future goals and overall branding strategy, and watch it become the groundwork for success. Don’t let yourself be overwhelmed by making hasty decisions; take time to find what fits you best.
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