Are You in a Warehouse Vs. Distribution Centre Dilemma?
For the majority of eCommerce startups, the idea of storing inventory anywhere other than in the spare room or garage may seem absurd. Once growth kicks in, though, getting inventory out of your house will start to look like an increasingly good idea. Which is when you’ll need to weigh up storage in a warehouse vs. distribution centre services. Read on to find out which is better for your business.
Warehouse Vs. Distribution Centre
As long as there have been goods to ship, there have been warehouses to store them in. The traditional model of the warehouse followed the requirement for stockpiled goods available to ship whenever and wherever the demand arose.
Supply chains have evolved over the past two decades and can now accurately predict demand, so the warehouse has evolved to match this new capability. Distribution centres (or fulfilment centres) still provide storage but it’s just one of the many fulfilment services it provides. These invariably include inventory management, warehouse management and tracking, picking and packing, distribution, and returns.
Passive storage capability still has a place in the supply chain, but it has been supplemented by the proactive management of inventory that distribution centres offer.
When is a Warehouse the Right Option For Business?
If you’re at the stage of needing to shift inventory out of your own space, but you’re not yet ready to scale your business, a warehouse may be the perfect option:
- Storage: Warehouses focus on providing storage space for goods and materials. If a business has a need for long-term storage or stockpiles seasonal goods, a warehouse can be a cost-effective solution.
- Cost: Warehouses tend to be less expensive to operate compared to distribution centres. They typically offer basic storage facilities without the added services and infrastructure that distribution centres provide, resulting in lower costs.
- Specialised Goods: Some businesses deal with specialised goods that require hand finishing. In such cases, a warehouse may be better suited to provide the necessary storage facilities that can be accessed as necessary.
When is a Distribution Centre the Right Option?
If business growth is steady and your customer base is solid, you’re most likely thinking about scaling your business. This is the stage at which a distribution centre becomes the more attractive proposition:
- Order Fulfilment: Distribution centres are designed for optimum efficiency when handling order processing and fulfilment. This is key to successful scaling.
- Inventory Management: Inventory management systems allow for real-time tracking of stock levels. This helps businesses optimise their inventory, avoid running out of stock, and improve their supply chain efficiency.
- Scalability: Designed to handle high volumes of goods, distribution centres can easily scale operations based on demand fluctuations. They offer the flexibility to accommodate seasonal peaks or sudden increases in order volume.
- Value-added Services: Additional value-added services are increasingly offered by distribution centres, such as custom packaging, kitting, personalisation, mailing, print on demand, and subscription.
- Time Sensitivity: eCommerce brands need fast delivery times. A distribution centre is designed for streamlined order processing and shipping capabilities, which are critical for meeting customer expectations.
How Can Prolog Fulfilment Help to Grow Your Brand?
If your brand is ready to scale, you’ll most likely have solved the warehouse vs. distribution centre dilemma by deciding that you’re ready to partner with a third-party logistics provider (3pl), offering distribution centre services. Prolog works with a number of eCommerce brands that are scaling, and we’re well placed to provide the support they need at this key transitional moment.
A Personalised Fulfilment Process
Prolog isn’t a machine that expects businesses to fit in with what’s on offer. We work as a proactive partner, committed to the growth of your brand. That means creating a personalised fulfilment process that offers exactly what your product requires in order to delight your customers.
Design and Packaging Specialists
Our services include packaging design that prioritises efficient, cost-effective, and safe movement of goods through the supply chain, while maintaining a focus on brand messaging. We understand the significance of a positive unboxing experience, and we work to achieve this using sustainable materials wherever possible.
Onboarding, Account Management, Support
Our onboarding process offers eCommerce businesses a seamless transition for your IT systems and business operations. You will have a dedicated Account Manager who will manage your transition and we guarantee support that is personalised, proactive and efficient at all stages of your journey with us.
Ongoing Scaling
Scaling in eCommerce involves expanding and growing your business without the need for substantial infrastructure investments. At Prolog, we provide cutting-edge infrastructure and utilise our fulfilment expertise to support brands, actively working to enhance efficiency and unlock the potential for increased sales throughout our professional partnership.
Warehouse Vs. Distribution Centre – Have You Decided?
Prolog Fulfilment has an established distribution centre with over 30 years’ experience in order fulfilment and logistics. If you’re looking for a 3pl partner that can help you to scale your business, we would love to talk to you. We’re centrally located in Nottinghamshire, and our fulfilment centre provides comprehensive order fulfilment services, as well as a range of value-adds.
