Warehousing is the storage of pallets and inventory in dedicated facilities.
Detailed Definition
Warehousing is the storage of goods in a dedicated building, together with the handling that moves them in and out. Core activities are receiving, putaway, storage, picking, packing and shipping. Pallets are stored in pallet rack such as selective, drive-in or push-back rack, in block stacks on the floor, or in automated storage and retrieval systems. Warehousing can be private, run by the owner of the goods, or public and contract, run by a 3PL.
How pallets move through a warehouse
- Receiving: unload, check counts and pallet condition, and match to the advance shipping notice or purchase order.
- Putaway: move each pallet to a storage location chosen by the warehouse management system or by set rules.
- Storage: hold pallets in rack or floor locations until needed.
- Picking: pull full pallets, full cases or single units for orders.
- Shipping: build outbound unit loads, stage them and load trailers.
Matching storage method to inventory
Selective rack gives access to every pallet and suits many SKUs. Drive-in, push-back and pallet flow rack store pallets deeper for fewer SKUs with many pallets each, and differ in whether the first pallet in is the first out. Block stacking needs no rack but depends on stable, stackable loads. The right mix depends on SKU count, pallets per SKU, rotation rules and building height.
Regulated storage
Some goods add rules. Warehouses that hold food for consumption in the US generally must register with FDA as food facilities and follow applicable current good manufacturing practice requirements in 21 CFR Part 117. Bonded warehouses store imported goods under customs control. Pharmaceutical storage follows good distribution practice, with temperature monitoring and documented procedures.
Authoritative Sources
- Material Handling Institute (MHI): the largest US trade association for material handling, logistics, and supply chain technologies.
Related Glossary Terms
Frequently Asked Questions
What is the difference between a warehouse and a distribution center?
The terms overlap. A warehouse emphasizes storage, sometimes for long periods. A distribution center emphasizes moving goods through quickly to stores or customers, with more picking, cross-docking and outbound shipping. Many buildings do both. When comparing providers, ask about storage capacity, daily throughput, order accuracy and the services included rather than relying on the label.
How are pallets usually charged in public warehousing?
Public and contract warehouses commonly charge for handling in and out, often per pallet, and for storage, often per pallet position for each month or other period. Extra fees can apply for labeling, rework, oversized pallets or special storage conditions such as temperature control. Rate structures vary by provider, so ask for a full rate sheet and model it against your expected pallet volumes and inventory turns.