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Warehousing and warehouse management are part of a logistics management system, which is itself a component in supply chain management.

Front Entrance

Inside Warehouse

Although viewed by some as simply a place to store finished goods, inbound functions that prepare items for storage and outbound functions that consolidate, pack and ship orders provide important economic and service benefits to both the business and its customers.

From manufacturers’ perspectives, factories are built to make goods and ship them in large quantities. Therefore, they have little interest in holding finished goods of their entire portfolio of products, with little interest in selling attractively-priced goods to small users who buy far less than the average distributor. What’s more, manufacturers don’t want to incur the costs associated with taking orders, shipping small quantities, invoicing customers, collecting payments, handling returns and providing after-market services. As a result, production facilities try to avoid these issues by creating organized channels, known as industrial distributors, for their supply chain.

When individuals are placing routine orders that don’t require a tremendous amount of support, questions such as, “How much freight is being consumed?” and “Why are these items being ordered so routinely?” may arise. A distributor may be able to examine usage patterns and recommend substitute products that may last longer; whereas manufacturers that are shipping direct would not take on such an advisory role. Additionally, if a problem with a part were encountered, the manufacturer would send a representative at his or her convenience for a fee.


A warehouse provides a central location for receiving, storing and distributing products. As each inbound shipment arrives, responsibility for the goods transfers to warehouse personnel, products are identified, sorted and dispatched to their temporary storage location.

Storage isn’t a static “thing” but rather a process that includes security measures and maintaining an environment that preserves the integrity and usefulness of the items. Once it’s time to move items, each order is retrieved, grouped, packaged and checked for completeness before being dispatched to their new destination.


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