Business Services
Warehousing provides different services:
1. It facilitates production in anticipation of demand : In the modern world production of goods is undertaken in anticipation of demand rather than against existing demand. Hence, warehousing provides services to store these goods properly till the demand for them is made.
2. Warehousing maintains the stock of seasonal production : Production of some of the commodities takes place only during a particular season of the year whereas the demand for the same exists and has to be net throughout the year.
Hence, warehousing helps in maintaing the even supply of these goods throughout the year.
3. Warehousing provides basis both to wholesalers as well as retailers : Storage constitutes the basis of operation by the wholesalers and retailers. Retailers store the goods to be made available to the customers on demand and wholesalers do so to maintain an uninterrupted supply-line to the retailers.
Warehousing provides opportunity to wholesalers and retailers to avail the economies of bulk buying as they often buy goods far in excess of their immediate demand which requires storage.
4. Warehousing enables the producers to respond according to production techniques : Sometimes the production processes may also necessitate storage of partly manufactured goods for varying periods.
5. Price stability : Sometimes storage of goods may become necessary in order to correct any distortions in prices e.g. in case of seasonal goods, their plentiful supply in the season may create conditions of glut thus forcing the prices to fall.
Warehousing enables producer to maintain stock of excess quantity during such period and thus, helps estabilishing the prices.
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