April 18, 2022

7 Main Functions of Warehousing

What comes to mind when you think of warehouses? Trucks, pallets and forklifts? While those are certainly some of the primary functions of warehouses, they're by no means the only ones. Warehouses fulfill a variety of important roles in the business world, from order fulfillment to distribution and more. Here are seven main functions of warehousing that all business owners should be aware of.

7 Main Functions Of Warehousing

A warehouse can be defined as a place dedicated to efficiently storing items and supplies. Almost every type of person or company that does business uses a warehouse. Warehouses are required by various companies, including transportation and customs, among others.

While this task may appear insignificant compared to other business process segments, it's important to remember that it's a dynamic operation that can yield a profitable return on investment if done correctly.

A warehouse's job is critical. Consider the following warehouse functions to understand this statement better:


A warehouse's primary function is to provide storage space for equipment, inventory, and other items. It provides suitable facilities for businesses to store their items when they are not required for sale.

The storage may be of two types-

(i) Planned Storage: It refers to the amount of storage that must be carefully calculated to meet regular client demand.

(ii) Extended Storage: It refers to the extra storage needed over and beyond what was intended. A variety of circumstances can cause this, some of which are listed below-

      - Demand Seasonality

      - Promotional Campaigns

      - Speculative purchases

Safeguarding Of Goods

A warehouse can build special arrangements for various products based on their characteristics. It can, for example, pay security personnel to prevent theft, set up a cold storage facility for perishable items, use insecticides to preserve food, and build fire-fighting equipment to prevent fires.

Movement Of Goods

It consists of the following-

     Inbound activity–It refers to the process of unloading products from a warehouse.

     Transfer to storage is the process of moving items from the receiving area to the storage area.

     Order selecting means choosing the item in storage that corresponds to the shipment order and moving it to the shipment location.

     Outbound activity–Outbound activity involves inspecting and loading products for shipment.


Another one of a warehouse's many purposes is financing. Warehouse finance is a sort of inventory financing in which a financial institution lends money to a manufacturer, business, or processor. In this situation, goods, inventories, or commodities are put in a warehouse and utilized as collateral for a loan. Warehouses may also provide money advances to depositors for a limited time while holding their goods as collateral in certain circumstances.

Value-Added Services

Value-added service is more than just warehousing. Such services aid in the optimization of supply chain management, the generation of increased value, and the effective delivery of items to clients. Bundling, customizing, re-branding, re-packaging, and processing are only a few examples. The following are a few of them:

   - Processing

   - Grading and branding

   - Other services

Price Stabilization

Warehouses have an essential role in the price stabilization process. They aid in the control of price volatility by –

   - Storing goods when their supply exceeds demand in the market.

   - Releasing goods when the request gains pace.

Information Management

Warehouses keep track of information regarding items and commodities received, stored, and delivered out of the facility. Aside from that, any additional information about the warehouse is kept track of. It enables warehouse managers and other concerned workers to obtain precise information on stock availability, processing, and replenishment needs.


Warehouses are an essential part of the business world, and it's important for all business owners to be aware of the different functions they serve. From order fulfillment to distribution and more, warehouses play a vital role in helping businesses run smoothly. If you're looking for warehouse management software, be sure to get in touch with Conveyr. We provide powerful software that makes managing your warehouse easier than ever before. Thanks for reading!

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