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28
May
2022

Are Dedicated Warehousing and Contract Warehousing the Same?

Are Dedicated Warehousing and Contract Warehousing the Same?

In a nutshell, dedicated warehousing is a warehousing service where a business leases an entire warehousing space to utilize all the labor, operations, equipment, and services provided by the warehouse. A dedicated warehouse is not shared with other tenants and is operated entirely by the business renting the space.

Contract warehousing, on the other hand, is a warehouse space that includes labor and services for multiple tenants. Contract Warehousing can be helpful for businesses that do not have the in-house resources to handle all of their own warehousing needs.

What is Dedicated Warehousing?

Dedicated warehousing costs more than a shared warehouse, and dedicated warehouses often require a longer contract (Usually lasting 3-7 years). Dedicated warehousing includes the cost of a warehouse facility, labor, operational processes, and systems. The warehouse itself is owned by the 3PL provider and leased to the customer.

Dedicated warehousing allows a customer to gain more control over the warehouse, which is more cost-effective than a shared space. 

What is Contract Warehousing?

If you're looking for a secure, low-cost warehouse or a way to outsource inventory storage, contract warehousing is the ideal solution. Not only is contract warehousing more affordable and beginner-friendly than dedicated warehousing, but it also allows you to scale up and down as needed.

A contract warehouse can provide all the same services as a dedicated warehouse while saving you the trouble of managing your own space.

Which One is Right For My Business?

Contract warehousing allows businesses to outsource their warehousing functions, allowing them to focus on strategic aspects of their business. Dedicated warehouses, on the other hand, allow businesses to take control of the warehousing operations, improving efficiency, and reducing shipping costs per unit.

If you're thinking about outsourcing your warehousing needs, contact 18 Wheels Logistics for professional advice.

For over 30 years, 18 Wheels Logistics has strived to be the most customer-centric trucking, warehousing, and logistics company around. Based in Burnaby, British Columbia, Canada, 18 Wheels relies on experience and integrity to make customers happy and remain on the cutting edge of shipping and logistics management.

If you have any questions about this article or you would like to talk to us about your shipping needs, please call us at (604) 439-8938.