Advantages and disadvantages of self-built warehouse

The advantages of this mode include: (1) the warehousing can be controlled to a greater extent. Because the enterprise owns the warehouse, as the owner, the enterprise can control the warehouse to a greater extent, which is helpful to coordinate with other systems.

(2) Storage management is more flexible. Because the enterprise is the owner of the warehouse, it can design and layout the warehouse according to the requirements of the enterprise and the characteristics of the products.

(3) Low storage cost. If the warehouse is fully utilized for a long time, it can reduce the storage cost of unit goods, which is also economies of scale in a sense.

(4) Maximize the strength of the enterprise. Storing products in their own warehouses will leave a good impression on customers for long-term sustainable operation, and customers will think that the enterprise is strong, stable and reliable, and it is a continuous supplier of the enterprise, which will help improve the competitive advantage of the enterprise.

The disadvantages of this model include: (1) The enterprise has invested a lot of money and occupied a part for a long time. No matter how the enterprise needs storage space, the capacity of the warehouse is fixed and cannot be expanded or reduced with the increase or decrease of demand. When the demand for storage space decreases, enterprises still have to bear the cost of the idle part of the warehouse; However, when enterprises have extra demand for storage space, warehouses can't meet it.

⑵ The flexibility of warehouse location and structure is poor. If enterprises can only use their own warehouses, they will lose the flexibility of strategic optimization and location because of quantity restrictions; The size of the market, the location of the market and the preferences of customers are all changing. If enterprises can't adapt to this change in warehouse structure and service, they will lose many business opportunities.