Advantages of a public warehouses

Business studies study module
  • A public warehouse serves a number of customers that deal with the same product. It assembles the small orders from these customers and places one order for all of them. This enables them to enjoy economies of large scale buying and delivery of goods to a warehouse.
  • Goods stored in a public warehouse may be sold without their physical movement from the warehouse.
  • Traders can rent space to store their goods
  • Traders do not have to construct their own warehouses/do not have to tie up capital in storage buildings and handling equipment.
  • Goods are insured against risks such as damage fire and theft
  • A trader may get a short term loan from the warehousing firm using the goods held as collateral security.
  • Apart from the handling, sorting and documentation of goods additional services such as bottling, bagging and repairs of damaged goods can be offered public warehouses.
  • Sharing equipment and machinery enables the users to reduce handling costs
  • Inspection, re-packaging and labeling services provide users of public warehouses the expertise they themselves may not have.

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