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By John Wisser | Supply chain Digital
There are many factors to take into consideration when opening a new warehouse facility. From location and build to storage requirements and labor force availability, making the right choices in regards to both warehousing and distribution methods could make all the difference for your company. While the below are what we consider the most important, this list is certainly not all-inclusive.
When deciding on which warehouse to use, choosing the one with the best physical location is important. The first question to ask yourself is, which region are you looking to serve? Ensuring your product is stored in a region near your customers is important for prompt deliveries. This also factors into considering cost. Calculating landed transportation costs to facility from manufacturing, and expected transportation costs from facility to end customer, will help decide where you can afford to keep your product.
The location’s proximity to carrier facilities should also be taken into account. Look for an all-encompassing solution that offers both warehousing and transportation to get the most bang for your buck, or ensure your storage facility is as close to your carrier as possible.
After you decide which warehouse best fits your needs, you must take into consideration the locations build and lease parameters. Does the warehouse offer rail siding or transloading? Will racked or bulk storage be offered, and what suits your needs best?
Just the same, plan to consider what type of rental contract your warehouse offers. If you’re a seasonal product it might make the most sense to find a location that offers seasonal warehousing. Or, if your product’s demand ebbs and flows, can the location you’ve chosen offer more or less space depending on the time of year? Ensure you’re properly informed of immediate square footage storage offerings in addition to the long-term options available.
From hazardous materials, flammable product and food items, many companies manufacture products that have strict storage and firefighting requirements. Is the location you’ve chosen properly suited to handle your unique needs? And how will they handle the different requirements for products that require a chemical/foam system versus a water based system? Always be sure to also take any environmental concerns into consideration, are there any streams, ponds, etc. in close proximity? Asking these questions now will help you avoid disaster later.
Labor Force Availability
Fully understand the labor force available at your new warehouse location. Knowing your labor needs and seeing how they stack up against the facility’s is essential to ensure on-time delivery and future growth. Will the warehouse facility operate 2nd and 3rd shift (24 hour operation)? Are there competing businesses in proximity that will become a barrier to growth by limiting available labor capacity?
By taking the time to consider the above, you can limit frustration and ensure you’ve found the perfect fit for both you and the warehouse you’re selecting.