OUTSOURCED WAREHOUSING SERVICES:

A Checklist For Small Businesses

• A third party warehousing company will generally be able to meet all of the warehousing and distribution needs of a small business.

• They will be flexible in the amount of space that you have to rent as they charge by the square metre.

• As your company grows you will be able to increase the amount of space that you rent depending how fast your business is growing.

• You will be able to rent more space when you need it, for example during busy time such as Christmas, when you may need to ship more goods or have them ready for any increase in demand for goods. This helps reduce the cost of storage as you do not have to rent a fixed amount of space for a given time.

WHY USE A THIRD PARTY WAREHOUSING COMPANY?

• When a small or medium sized business outgrows their existing warehousing facilities, they need to start to consider and look at outsourcing their warehousing and distribution needs to a dedicated warehousing facility that fits with their logistics requirements…

• Start-up businesses need the ability to be flexible with the amount of space they can hire as the business could grow fast or slowly. Discount warehousing rates for start-ups also may be another factor to take into consideration.

• This is a guide that will help you to decide on your logistics and warehousing company…

• Draw up a list of requirements and must haves from your warehousing company. A few could include:

• Short delivery times for goods• An entire warehouse staffed and managed• Shared space that expands and contracts as required• No long term leases• No capital expenditure• Discount prices on start-up businesses• A company that can also offer freight forwarding services for

transportation of your products.

YOUR REQUIREMENTS

• It can be difficult to find a company offering safe and reliable warehousing services, so here is a helpful checklist to ensure that your company gets the right level of service when outsourcing its storage needs.

THIRD PARTY WAREHOUSE MANAGEMENT CHECKLIST

• How are the items stored? Will they be stored in such a way that they will be easy to find? It is essential that all items are correctly labelled so that anybody looking for a particular item can find it easily based upon a label.

• You should ask to look at how they store products for other clients, this will give you an idea of how their operation is run.

• You should also ask them to do a test run of their fulfilment process to ensure that it is efficient.

• Efficiency is essential when running a warehouse and storage operation, if a company is found un-organised at this stage, you should look somewhere else.

1. INTERNAL ORGANIZATION

• Having proper security in place at a warehouse facility is essential. Make sure that the facility has an alarm and well trained security staff.

• Although you have insurance in place with the company, you should never rely on it for any stolen or damaged goods. Make sure you are insured in the terms and conditions of your contract and take out extra insurance if needed.

2. SECURITY 

• It is absolutely essential that your 3rd party logistics provider has the right kind and amount of insurance to cover the kinds of goods that you are looking to store at the facility.

• You will need to ask them to add your business to be listed as an additional company to be insured and you should request to see proof of documentation to ensure you are covered correctly.

• You will also have additional insurance responsibilities and you will need to speak to your insurance provider to make sure you have also have the right cover.

3. INSURANCE

• You should ensure that the facility is properly managed and has all the necessary building and fire regulations in place, for example working fire alarms, sprinkler systems and fire extinguishers.

• Ensure that the staff have the right level of training to deal with any hazardous situations that may arise as they will need to be able to protect your goods and stock.

• You should also ask to see all of the necessary safety certificates.

4. BUILDING & FIRE REGULATIONS

• Ensure that there is a procedure in place for dealing with pests. You may not see any on your visit, but if pests are not controlled in a warehouse environment they can wreak havoc with your goods, especially if you store food goods and furniture.

• Without the correct procedures in place pests will get into the building and its essential that the warehouse provider that you choose is fit to handle them.

5. PEST CONTROL PROCEDURE

• Finally you should carry out a spot check to ensure that the facility is clean all of the time, not just on the day you are appointed to come.

• If the warehouse is untidy, this can reveal a lot about how it is run and managed. If they warehouse is messy this provides you with enough evidence not to go with the provider, as you do not want your products stored in an untidy environment.

6. OVERALL CLEANLINESS

Choose your Warehousing provider carefully and ensure they have all the necessary needs for your business.

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