The Difference Between Public Warehousing and Contract Warehousing
Which 3pl service is right for me?
When we talk with new clients about their warehousing needs, they are often thinking short-term. They see warehousing as a solution to store inventory today, but, the truth is, warehousing for a growing company often becomes a long-term partnership.
In a long-term partnership, a 3pl service provider is able to make concessions, so that the process is more cost effective for the client. In our business, we call this contract warehousing. With this arrangement, clients enter into a contract to take X number of warehousing space from a 3pl, for a specific amount of time.
Why is it lower? For us as a 3pl service provider, it all comes down to being long-term. You have agreed to do business with us for an extended period of time, so we will not need to worry about filling that space.
In fact with contract warehousing, you will not notice a different in service. The space is the same. The locations are the same. The people are the same. The only difference is the terms of the storage.
We will handle all of the costly items, like searching for qualified logistic professionals, buying the equipment to run a warehouse, and taking on the overhead.
For anyone using public warehousing, we suggest looking into contract warehousing. You may be surprised at the cost savings you can access, all while continuing to use a service that you’re already familiar with. It’s like having your cake, and eating it too.
As your business changes, contract warehousing will still allow you to thrive. I cannot tell you how many long-term partnerships we hold, where our clients’ needs have completely shifted. No matter the challenge, I guarantee we have the answer!
And just because you sign a contract doesn’t mean there isn’t flexibility. As we all know, inventory levels fluctuate – especially seasonally. If you see a boom and need more warehousing space, we can accommodate that.
The amazing part about the logistics industry is its ability to change and evolve to accommodate the outside world. To keep you up to date on the latest changes, challenges and evolutions of the 3pl industry, we have put together a newsletter for our friends and clients.
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