What's the Difference Between Warehousing and Storage

Virginia Miller

June 21, 2024

In this article

Do you need to store some extra inventory? Are you not sure whether to choose a warehouse or storage unit? Both warehouses and storage units have unique benefits, which is why deciding which option is best for you can be challenging. In this blog post, we will discuss the critical differences between warehousing and storage so that you can make an informed decision. Keep reading to learn more!

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Warehousing vs Storage: Key Differences Explained

What is Warehousing?

Warehousing refers to the storage and handling of goods on a large scale, usually in a warehouse. Warehouses store inventory for manufacturers, importers, exporters, wholesalers, transport businesses, customs, etc. They provide facilities like loading docks, materials handling equipment, security, climate control, etc. Warehouses are optimized for quick storage and retrieval of goods to meet business needs.

What is Storage?

Storage refers to the storing and safekeeping of items and goods. It's typically used to describe smaller-scale storage options compared to warehousing. Examples include self storage units, vehicle storage, cold storage, inventory storage, records storage, etc. Storage facilities provide space, security, and basic access - specialized material handling is typically not offered.

Key Differences Between Warehousing and Storage

Scale and Capacity

Warehouses are designed for high-volume storage. They can accommodate large quantities of goods. Storage facilities have less capacity and are better suited for smaller volumes.

Purpose

Warehouses support business operations and logistics. They offer specialized services to receive, handle, store and ship inventory efficiently. Storage mainly provides space to store goods securely - supporting services are limited.

Duration

Goods typically move through warehouses quickly on their way to customers. Storage keeps goods for longer durations before their final use or disposal.

Location and Access

Warehouses are located near transportation hubs for efficient distribution. Storage facilities tend to be near residential areas for easy access.

Cost

Warehousing is more expensive due to material handling systems, frequent inventory turnover, specialized storage (e.g. cold storage), etc. Storage costs less as facilities simply provide space without advanced capabilities.

Types of Warehousing

Public Warehousing

Public warehouses store goods from multiple companies in a shared facility. They offer flexibility, allowing customers to expand or decrease storage. Public warehouses also provide services like tracking inventory, shipping orders, securing storage, etc.

Private Warehousing

Private warehouses are dedicated facilities owned by a single company to store their own goods. This allows customized storage solutions, but has higher fixed costs. Private warehouses also offer better security and control.

Bonded Warehousing

Bonded warehouses are licensed by customs authorities to store imported goods until duties or taxes are paid. They enable deferring those payments until products leave the warehouse.

Refrigerated Warehousing

Refrigerated warehouses store perishable items like food, flowers, pharmaceuticals, etc. in climate controlled environments. This specialized storage preserves quality and prevents spoilage.

Types of Storage

Self Storage

Self storage units are rented out to individuals or small businesses. Each customer has a lockable unit accessed with their own key for storing household goods or small business inventory.

Vehicle Storage

Vehicle storage facilities provide indoor and outdoor parking spaces to store cars, boats, RVs. They cater to owners that have limited parking space at home or need temporary storage.

Document Storage

Document storage warehouses provide specialized services to store paper or electronic records, like archives, medical records, legal files etc. Documents can be securely stored and retrieved as needed.

We hope this overview has helped explain key differences between warehousing and storage. Please contact us if you need any assistance finding the right facility for your business!

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FAQs

What are the main differences between warehousing and storage?

The main differences between warehousing and storage relate to capacity, purpose, duration of storage, location, costs, and services offered. Warehouses accommodate large volumes for business operations while storage facilities handle smaller quantities for longer-term household storage.

What are some types of warehousing?

Common types of warehousing include public warehousing, private warehousing, bonded warehousing, refrigerated warehousing, and more. Each caters to different business needs relating to scale, security, specialized storage, duty/tax deferment on imports, etc.

What are some popular types of storage?

Top examples of storage solutions include self storage units, vehicle storage, document storage, cold storage, inventory storage, records storage, and more. These cater to individuals and small businesses looking for secure space to store their possessions.

Is warehousing more expensive than storage?

Yes, warehousing tends to be more expensive than storage. Warehouses invest in specialized material handling systems, need to accommodate frequent inventory turnover, provide specialized environments (e.g. cold storage), etc. making costs higher.

Which is better for short term storage?

For short term storage typically lasting days or weeks, warehousing tends to work better. Warehouses actively handle goods for short transit times before shipment to customers. Storage facilities focus less on turnover.

Which is better suited for consumer goods storage?

Storage facilities like self storage units work well for consumer goods storage by households and small businesses. The scale matches well with lower capacity needs, longer duration, and accessibility to residential locales.

What factors should I evaluate when deciding between warehousing and storage?

Key factors to consider are storage duration, scale, accessibility needed, specialized handling requirements, security needs, costs, and transportation logistics. Analyze your specific business situation against these factors to decide.

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