As a small business owner, you’re always looking for ways to make your company more profitable, efficient, and customer-oriented. If you sell physical products, one decision you’ll have to make is whether you want to store your inventory yourself or outsource it to a third-party warehouse.
Storing your products yourself is probably fine at first, but as your business grows, outsourcing might be the best option. The experts at Cargo County offer these advantages of warehousing for small businesses.
Lower Initial Investment
When you run out of space in your current storage area, you’ll have to figure out how to get more space. Expanding your store’s “backroom” is probably going to be expensive, plus with building permissions getting stricter all the time, you might not even be able to expand. That means you’ll be looking for a bigger space for your store or an off-site storage solution that you can either buy or lease.
Using a third-party warehouse means that you’ll only pay for the storage space you currently need. You don’t have to buy or rent an entire warehouse, which is costly and probably not the best use of investment funds until you’ve grown enough to use all the space.
You can simply contract a third-party warehouse to lease you the exact amount of space your inventory requires. This is a more cost-effective way to handle growth because you won’t spend more than you need at any given time.
Scalability
As your business grows, you’re continually going to need more space. It’s not a one-time thing. Even if you expand your current space, it’s going to be too little at some point in the future and you’ll have to go through the process all over again.
With third-party warehousing, you simply lease more space when you need it. This solution grows with your company, allowing you to have access to as much or as little space as your products require.
Lower Risks
What happens if you buy or lease an entire warehouse only to have the economy turn and suddenly your company isn’t growing as fast as you had hoped? You’re pretty much stuck with the mortgage or lease for the long-term. You can’t liquidate a warehouse very quickly, especially if the economy is bad.
This could spell disaster for your company. But, with a third-party warehouse contract, you can adjust the space you have based on your business needs.
The risks associated with contracting warehouse space are much lower than investing money in a purchased or leased warehouse. You may lose some money if you have to break a contract, but you definitely won’t lose everything!
Security
Is your current storage solution as secure as you would like it to be? Unless you have a state of the art security system and on-site security personnel at all times, it’s probably not very secure at all. A third-party warehouse will have some of the best security money can buy because it is responsible for the security of thousands of products. Plus, insurance will be included as well.
Conclusion
There are very few drawbacks to outsourcing your warehouse space to a third party. Just do your research to make sure you’re partnering with a solid company and leave your warehouse concerns to the experts.
