Distribution centres play a huge role in how we get goods to our local stores up and down the country. They are used as storage for retailers before goods get dispatched to shops or for online orders. So the main purpose for a distribution centre is to hold stock, until it is needed. Sometimes centres can be shared by several small businesses to reduce overheads or are owned outright by larger companies, who rely on having large amounts of stock, but do not have a large amount of shop space. They are also heavily relied on by online companies, who use a digital shop platform. Traditionally large retail chains such as Amazon own their own distribution centres, this minimizes their overheads, by cutting out the middle man and they likely have more than one distribution centre. They tend to place them strategically throughout the countries that they ship to.
There are three main sections within a distribution centre, including: the shipping dock, receiving dock and storage area. These three areas can then be broken down into smaller sections. The storage area might be divided into different sections depending on what is being stored like food. If the distribution centre is storing perishable and non-perishable food, then you will often find sections for refrigeration or sections that are air conditioned, to keep the food fresh. If a third party distributors store more than one retailers stock, there will be areas set out for each of the companies they provide storage for. Stock cannot be kept all together due to the possibility of mix ups. This is bad for business for both the distributor and the retailer as unhappy customers receiving the wrong goods will be dissatisfied and unlikely to use that retailer again.
Most distribution centres operate in the same way, there are some differences in what they provide. The main three different types of distribution centres are the package handling centre, warehouse and fulfillment center. The package handling centre tends to receive goods and then dispatches them straight away to whomever they are going to. However a fulfillment centre normally stores goods before sending them straight to the customer. This is a common place for any purchases from catalogues or online stores, to come from. A warehouse on the other hand tends to store products, that will eventually sit on shelves in a shop. For Used Pallet racking visit https://www.rackzone.ie/pallet-racking.
Efficiency is where a distribution centre can make it’s profit. Through ensuring overheads are low, labour costs are kept to a minimum and regular turnover of stock is upheld. This creates a smooth flow, with good turnaround times leading to customer satisfaction and ensures that their company is seen as competent in their field. This will mean that retailers are far more likely to use their services again in the future. So next time you pass a huge centre belonging to a retailer, you have an idea of what is going on and just how busy they will be sorting out the logistics of distribution.