CCFL SEM III
COURSE: WAREHOUSING STORAGE
TOPIC: Introduction to Warehousing
Learning objectives;
By the end of the topic, the trainees should be able to:
Explain the meaning and roles of a warehouse
Identify different types of warehousing organizations
Explain different types of warehouses
Identify factors to consider in setting up an ideal
warehouse
Explain the advantages of warehousing in cargo supply
chain
Warehouse. It’s a facility that provides a
proper environment for the purpose of storing
goods and must be protected from the elements
i.e pests, thieves
Warehousing. This is an activity involving
storage of goods on a large scale in a systematic
and orderly manner and making them available
conveniently when needed
ROLES OF A WAREHOUSE
• Steady/continuous flow of goods
• Stability in prices
• Security
• Bridging the time lay/difference between production and consumption
• Continuous/uninterrupted production schedules
• Preparation of goods for sale.
• Sale of goods
• Specialization
• Unexpected demand can be met
• Clearance of goods
• Improving the quality of goods
• Enable buyer to inspect the goods before they buy them
• Wholesale warehouses may also operate as showrooms for traders
Warehousing Organization
• Centralization warehousing organization- a system where retailer or its suppliers maintain a single central
warehouse unlike several facilities spread out to cover a territory. Decision making authority is assigned to
higher levels of organization hierarchy such as head office.
• Decentralization warehousing organization. System where organization maintains several warehouses over a
territory. Decision making is authority is assigned to lower levels of an organizational hierarchy such as
divisions, branches or locations.
Preferred when you have many customers spread out over a large area.
• Combined warehousing organization. This is the combination of both centralized and decentralized
warehousing management system in that decision making is assigned to both high levels authorities and some
decision are assigned to the lower level authorities.
TYPES OF WAREHOUSES
Bonded warehouse. Any place or a building licensed by commissioner of customs for the deposit of imported dutiable goods
whose duties have not been paid and have been entered for warehousing(first importation)
Private warehouse. Warehouses that are used exclusively by owners for the purpose of storing their own goods i.e wholesalers,
producers retailers
Public warehouse. Warehouses that are owned by business people for the purpose of storing goods for the general public and they
charge fees for storage services.
Government warehouse. Any place or building provided by member state (EAC) and approved by the commissioner of customs for
the deposit of dutiable goods whose duty has not been paid and have been entered for warehousing.
Customs warehouse. Any place or building or a building approved by commissioner of customs for the deposit of unentered,
unexamined, unclaimed, abandoned or ceased goods for the security thereof and for protection of taxes thereon. Examples Forodha,
ICD Embakasi, Mitchell Cotts. A proper officer when situation warrants can declare any place a customs warehouse.
Cooperative warehouse. Warehouse owned by cooperative society for the deposit of goods of their members and they offer subsidized
storage rates i.e KTDA
Consolidated warehouse. It is for the deposit of goods in small and large quantities and distributed to various destinations in small
and large quantities.
Value added services warehouse. Warehouse where goods are deposited for further processing i.e labeling, beranding, packaging,
sorting , grading. Example Banana Warehouses in Uganda
Open yard warehouse. Warehouse for storage of goods that can not be affected by weather i.e vehicle yards
FACTORS TO CONSIDER IN SETTING UP WAREHOUSE
• Location
• Proper building
• Equipment
• Accessibility
• Safety and security
• Communication
• Qualified personnel
• Safety and security
IMPORTANCE OF WAREHOUSING
• For seasonal production. Goods that are harvested once in a year
but consumption is throughout the year.
• Seasonal demand for products that are produced throughout the
year but are seasonally demanded.
• For quick supply of goods. Goods that are produced in particular
areas but consumption is throughout the country
• For continuous production
• Large scale production
• Price stabilization through constant supply
Advantages of Warehousing
• Protection and preservation of goods
• Facilitation of sales
• Creation of employment opportunities
• Financing
• Risk reduction. Minimal chances of loosing goods in a warehouse
Q&A
THANK YOU
END
