Notes

Warehousing and Distribution Concepts For US Based Companies
US based warehousing and distribution companies are considered to be the back bone of the modern industry. These companies are an integral part of the supply chain network. Warehousing refers to the transportation, production, processing and storage of finished goods. The term is usually applied to a business activity affecting the movement of raw materials and finished goods. It is also referred to as transfer, movement or transportation. This activity creates opportunities for US companies to compete in international markets.

There are many factors that affect the market behavior of these companies. These include government regulation, fluctuating commodity prices, increasing demand, technological advances, competition from companies with access to different resources and the introduction of new products. As far as these factors are concerned, supply chain is one such aspect which directly affects the overall performance of a company. There are many challenges faced by companies in the area of warehousing and distribution. In fact, it has been found that the efficiency of companies comes down when they fail to address some of these issues.

The supply chain is complex and very intricate. This is because companies based in the US are not able to function in all the corners of the world. Companies usually face difficulties when they have to deal with suppliers from countries that are not their local ones. In the case of companies based in the US, the difficulty of dealing with foreign suppliers arises when the companies find themselves isolated in terms of language, culture and technology. Many problems arise when companies have to restrict their operations to only those countries that meet their specific demands.

For instance, warehousing demands for the items manufactured in China grow on a daily basis. Given the size and scope of China, it is not possible for companies manufacturing in the United States to keep up with the speed of the Chinese manufacturing process. The result - they are forced to outsource their warehousing requirements to countries like China.

The United States is a major exporter of goods in many sectors. However, it has been observed that many of these goods are sold at lower prices in other markets. This has led to a situation where companies have to incur warehousing costs even when they are bringing the same goods back from these other markets. Companies can avoid such problems by investing in warehouse equipment that can be used across the supply chain.

A warehouse distribution system is required when companies based in the United States need to transport their goods from their warehouses to distribution points. These points include retail stores, wholesalers and import dealers. Warehousing requirements of companies based in the United States include the transportation of perishable goods, chemicals and raw materials. Companies are normally characterized according to the type of distribution they require including direct distribution, order fulfillment and third party logistics.

Companies that operate according to the first or second level of the chain are called first level distributors. On the other hand, chain distributors are those companies based on the third level of the chain who provide packaging systems. Warehousing and distribution systems have a further classification according to the number of employees needed for handling the inventory. Large companies usually have a chain of personnel working within each other.

The main function of these warehouses is to stock the inventory of the companies based in the United States. The warehouses are designed to meet the warehousing and distribution requirements of the companies based in the United States. They are also designed to provide security and protection to the goods. US based companies can reduce the costs related to transportation, storage, gathering and promotion of goods by investing in a warehouse management system. By using a warehouse management system, companies will be able to improve efficiency by managing the whole warehousing and distribution process.
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