A decline in available warehousing has made US companies– big and small– scramble for an alternative to an outdated system of inventory management. One solution that is growing in popularity is multi-client warehousing due to its time-saving and cost-effective nature.
What is multi-client warehousing?
Multi-client warehousing is one of today’s many warehousing options. It allows several companies to occupy a single warehousing unit. This makes sense for many businesses because it allows those who need shipping to customize their warehouse capacity to the demand for their product. This style of warehousing and logistics management is extremely popular amongst e-commerce websites and small businesses.
Why the sudden change in warehousing?
CBRE Group Inc. published a report in October of 2018 that stated the availability for U.S commercial real estate has been on a rapid decline for some time. In the third quarter of 2018, commercial real estate diminished by 11 basis points– making it the longest streak of declines since 1988.
The continued rise of e-commerce seems to be the driving factor in all this, with e-commerce, retail success increasing the demand for warehousing space and very little space to available.
For manufacturers, running a single dedicated facility is virtually unattainable due to the high cost and scarcity of space.
The Benefits of Mult-Client Warehousing
Regardless of how the future of retail plays out, we know that effective logistics will be the key. That’s why you need an adaptive and forward-thinking logistics company like Expak. To discuss more about how we can improve the efficiency and speed of your deliveries, get in touch with our team of supply chain experts at your convenience. We look forward to helping your company find success.
- Flexibility
- Multi-client warehousing favors small business companies or companies whose supply and demand fluctuate due to their shorter, more flexible contracts and arrangements. For these clients, the ability to change size dependent on distribution needs is crucial to the success of their starting business
- Improve Efficiency
- Companies who decide to operate their own warehouse may not be fully aware of the trials and tribulations that come with organizing the fulfillment process. When partnering with a multi-client warehouse or 3PL logistics partner, you can feel secure in the fact that these are trained professionals who know how to expertly care for the supply chain of your business. 3PL logistics partners will also be aware of the technologies and systems that should be implemented to assure smooth logistics management.
- Reduced Risk
- When allowing a 3PL logistics management team to handle your supply, companies who are managed within the same warehouse do not have to worry about the risk or responsibilities that come with managing a warehouse such as pensions, insurance, systems, and processing, etc
- Cost-Effective
- Sharing warehousing space with other companies assures that your company is not solely responsible for the cost of labor or operational costs of the facility. Companies will also only have to pay for the space that is occupied within the warehouse, rather than paying for the warehouse as a whole.
