How Can A Contract Warehouse Lower Logistics Costs?

Supply chain management has been a key topic in circles about reducing operational costs. Warehousing is expensive and the return from it does not always reap the expected benefits. Yet, a company cannot exist without its warehouse. This has led to the development of warehouses that specialize in storage and fulfillment services. Schulze Container is a contract warehouse that specializes in 3PL services. Let us explore what they have to offer and how outsourcing can help your company save significantly on operational costs.

First, let us examine what a 3PL is and the services they provide. It provides services for use by their customers such as transportation, warehousing, inventory management, packaging, and freight forwarding to help fulfill the orders placed by their customers' requests. This contrasts with the traditional warehousing model which serves only one business. In this type of outsourcing, many customers share the same warehouse.

One of the key advantages to using this type of service for your company's logistics is that they specialize in storage and warehouse operations. They provide many other services for your company such as inventory management, shipping, etc. That is the only thing that they do, and for this reason they do it well. Services can be bundled and discounts can be offered based on the package for your company.

Now let us get on to why outsourcing your logistics is cost-effective for your business. The reason for this is that many customers share in the expenses of the warehouse, which allows the business to lower their prices accordingly. It has the same operating expenses based on the amount of space under one roof. It takes the same amount of energy to provide light and heat to operate for 10 customers as it would for a single customer to operate the same building on their own. The costs are the same, only they are spread out over the number of customers that the contract warehouse has. The services offered go beyond simple picking and packing. Schultz Container offers direct store delivery, a full backup generator in case of loss of power, dry storage, a pallet exchange program, RFID tagging of packages, and garment on hangar (GOH) services that are only offered by a few select places. It provides specialized 3PL services that are unique for their clients.

A contract warehouse that specializes in 3PL fulfillment services can save money for your business through outsourcing the supply chain. Shared uniform overhead costs are the main feature that allows them to do so and therefore pass the savings to their customers. Many of the largest retail stores across the country choose to outsource their warehousing needs because it is cost-effective. Customers include brick and mortar retailers such as Wal-Mart, Costco, Best Buy, and Kmart. However, they are also becoming a popular choice with online retailers such as Amazon and Barnes and Noble. These specialized services are a developing trend in all areas of business and 3PL is becoming the only way to manage fulfillment services.

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Stewart Wrighter recently stored the overstock from his store in a Los Angeles contract warehouse. For more information about contract warehouses go to

http://www.schulzecontainer.com/ .

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