Startup companies often struggle to find the necessary capital needed to fund growth. Often, they need warehousing and distribution services, which they try to do on their own. This may sound like a good idea, so the control of these aspects stays within the company. However, buying a warehouse, staffing it, obtaining the equipment, and gaining experience is time-consuming and expensive. The truth is that warehousing and distribution for an expanding startup company should be outsourced for some excellent reasons.
Decreased Warehouse Expenses
Purchasing an existing warehouse is tricky – the space has to be large enough and set up logically and productively. In addition, staff must be hired and trained, and equipment purchased, procedures developed, and the list goes on.
This adds up to significant upfront investment, and most startup companies simply can’t afford to do it all themselves. Outsourcing warehousing means the space, equipment, technology, and staff are already in place. All of the overhead costs are the logistics company’s responsibility, not the startup, helping to decrease variable expenses.
Better Distribution Of Products
Distribution entails a physical transfer of products through one or more intermediaries before they reach their final destination. Inexperience in this arena leads to errors that interrupt the distribution process. An inability to distribute products can lead to a decrease in sales and customer service, quickly developing into a financial disaster.
An experienced distribution company helps businesses expand their reach into new markets quickly and efficiently. In addition, many distribution companies offer other value-added services, like packaging, to further aid in the distribution process. These types of services help companies streamline their supply chain and realize higher profits.
Improved Company Image
Inefficient processes, on any level, can have a devastating effect on the image of a company. Customers are easily put off by mistakes and quickly jump ship once their tolerance threshold is exceeded. When a company’s warehouse facility lacks organization or adequate staff, products cannot be moved efficiently, and customers are left empty-handed.
Likewise, if the distribution channel is inefficient or poorly managed, shipments will not promptly arrive at their destination, disrupting the receiving company’s schedules. Outsourcing warehousing and distribution services overcomes these obstacles and creates a smooth process that benefits everyone involved in the supply chain.
No matter how small or large your startup company is, you have a big decision to make when you’re ready to expand. Do you use your capital to invest in a facility of your own, or do you outsource to a reliable logistics company? Take a look at the numbers and determine what other business operations you could improve with extra capital saved through outsourcing. Those savings could open up new avenues for further growth.
CWI Logistics – Organized for Your Success
At CWI Logistics, we are experts in warehousing and distribution services and can offer your start-up many options. We have operated for over 50 years, so we are extremely knowledgeable and able to customize your warehousing and distribution solutions based on your needs.
Contact us today to discuss all of your freight storage and logistics needs.
Since 1966, CWI Logistics has been one of the leading logistics companies in Florida and the southeast. Today, we’ve got 11 strategic locations, and we provide the best turnkey 3PL solutions in the area.
We’re always here to help – from dock to dock and door to door.
CWI Logistics – organized for your success.