The business world is highly competitive and it should be always kept in mind that it doesn’t revolve around a single business. Each business is in a race of satisfying clients better than its competitors and ultimately, aiming for expansion and goodwill. Therefore, outshining competitors by providing better service is extremely important in a globalized economy. A competitive firm has to keep the “satisfaction of clients” as a top priority.
Future of the Warehousing and Transportation Industries
What do we mean by logistics?
Suppose you are a toy manufacturer and have a consumer base all around Canada. You have to make toys available to the customer or make raw materials for the toys available at the production plant. How will you make this possible?
Making the goods available at the right place, in the right quantity and at the right time is a crucial element of satisfying the client. If the goods aren’t made available to the clients, it will hinder expansion and put a halt on the operations of the business. This problem of making goods available is solved by the warehousing and transportation industry.
Making goods available can be carried out in two ways: one, making a division in the company, known as a logistics department, and assigning duties to the employees for running the department, or two, by outsourcing transportation to third party transporters, known as freight forwarding services or logistics companies. The company can choose either of the two options according to its will and capability.
The freight forwarding industry (known as logistics companies) is one of the fastest-growing industries in the world. Since every industry requires transportation facilities for moving the goods, freight forwarding services are in much demand. These industries have “derived growth”, and indicate the growth of all the other industries requiring transportation services.
What do we mean by warehousing?
Let’s consider the previous example that you are a toy manufacturer. The demand for the products in the marketplace is never stable and consistent. When the demand for the toys isn’t equal to what you’ve produced, this creates a problem. The problem becomes even more complicated if you’re dealing with products that are perishable or have particular requirements for their storage. This problem is solved by warehousing services which allow for the storage of your goods to be able to sell them when the market conditions are suitable.
A warehouse not only ensures proper safety of goods by keeping them from any kind of deterioration, they also protect the goods from theft and robbery.
Like logistics companies, companies can hire a third-party warehousing service. Many companies don’t own their own warehouses as it requires a large area and investment and doesn’t make economic sense. Therefore, many companies hire warehousing services for the storage of their goods.
Warehousing and transportation services are one of the leading and fastest-growing services in the world. It is estimated that the supply of warehousing space will double by 2022. This is a sign of the growing need and popularity for warehousing services. And of course, all the production industries and many trading firms require warehousing services for their goods.
The Boom of the Warehousing Business
With the boom of e-commerce, the demand for warehousing services has increased immensely. Businesses are requiring larger spaces for storing their products. Warehouses, not only store products, but they also help with the packaging and dispatching of the products. For example, Amazon, an e-commerce website, owns the world’s largest warehouse for its products and helps third-party retailers with storage and distribution.
As e-commerce is expanding all around the world, the demand for shipping companies is also growing. These warehouse logistics companies ship the goods from the warehouses to the next level of distribution. For example, in companies like Amazon and Flipkart, the products are shipped from the retailer to the end consumer.
Both warehousing and logistics are growing hand in hand. Logistics not only makes the goods available to the end consumer, but also takes the goods to the warehouse for storage and takes raw materials to the place of production. Warehouses store and protect the products from deterioration and theft, and help in stabilizing supply and price. Hence, both logistics and warehousing and transportation services are an inherent part of an economy, without which economies can’t remain stable and carry out its operations easily.
- Posted by admin
- On April 30, 2020