Many businesses are cyclical finding that business booms certain months and in other months, orders just trickle in. If you invest in your own warehouse, you may find that, depending on the time of the year, you pay for areas you do not use, thus losing efficiency. 3PL providers can scale to meet your current needs. Furthermore, when you lease or purchase the warehouse it is you who is on the hook for the total costs. By outsourcing, this risk is avoided.
Most frequently, when comparing the costs of outsourcing warehousing versus in house operations, companies do a fairly good job of anticipating hard costs associated with cartons and other packaging materials. However, frequently companies forget to consider minor warehouse supply costs that, when totaled, amount to a substantial amount of money. For example, some of the more commonly forgotten supplies costs include: down time or nonproductive labor – plastic wrapping – banding – pallets – warehouse scanners – communication devices – capital equipment – software programs –your personal labor – paper / labels, etc. These costs can easily cause faulty conclusions.
When operating your own warehouse, it is you who responsible for directly paying costs. At FCW for credit worthy clients, we offer payment terms which improve clients cash flow and operational costs.