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What is a shipping warehouse?

Whether you’re a shipper or a customer who enjoys ordering items online, you want the product to arrive undamaged. One way to ensure that happens is to store the item in a safe and secure facility until it’s ready for shipping. 

That’s where a good shipping warehouse comes into play. This article will cover the warehouse shipping process and the types of warehouses available for storing your goods. Let’s get started.

And when you’re finished reading, check out the other articles in our ‘Warehouse software’ series:

What Is the Importance of Shipping Warehouses?

Before a product reaches the customer’s doorstep, it must be kept in a protected location. If not, manufacturers will lose revenue due to damaged, lost, or stolen products. A shipping warehouse serves as a storage, receiving, sorting, packing, and shipping facility all in one. 

They have the staff and equipment necessary to prepare the product for delivery once it’s ordered. Warehouses are also typically near shipping ports, airports, and trucking companies, keeping the transportation aspect of the process simple. Modern warehouses have the latest and safest handling equipment. 

The technology also keeps the warehouse shipping process uncomplicated by allowing employees to find items and get them ready for pick up quickly. Software programs manage the logistics and keep track of inventory to maximize efficiency. Shipping warehouses take on a lot of small tasks so the business owner can concentrate on running their company and making sales.

Type of Warehouses

The needs of each business vary based on the goods sold. Here is a list of the different kinds of warehouses you can choose from. 

Public Warehouses

These are owned and operated by the government for use by the public and private businesses. The technology used may be a bit dated, but public warehouses offer great rates if you need a basic storage facility. 

Private Warehouses

Private warehouses are owned by private companies and are used to store the goods they manufacture or sell. Some facilities allow extra space to be leased to other companies or the general public. These warehouses often have the latest technology and can also help you transport goods. 

Cooperative Warehouses

This facility is owned by a collective group that leases space to the group’s members at a discounted rate. Farmers usually unite to purchase a warehouse for storing their crops or items to sell at the local farmer’s market. There are occasions when they open the warehouse up to the public for a higher rate than co-op members are charged.

Bonded or Duty-Free Warehouses 

Importing goods from overseas can become costly once you add customs duties and taxes. This warehouse allows you to store your imported items here until they’re ready to be shipped. 

Only then will you have to worry about paying customs duty and taxes. You can hold on to your working capital with this system which is great news for companies that import a large amount of high-value items. 

Consolidation Warehouses

This warehouse accepts small orders from customers sending items by sea to the same location. It’s sometimes referred to as a shipping container warehouse. The orders aren’t big enough to fill an entire container on their own. 

Still, the consolidation warehouse lives up to its name. It combines shipments from different customers to pack into a container until it’s full, which reduces costs for shippers who are splitting the total price of the container.

Smart Warehouses

A smart warehouse has the most updated technology to handle logistics. You may even see drones and robots employed as pickers and fulfilling other roles in the warehouse. 

Key Features of a Smart Shipping Warehouse

Implementing technology to complete tasks faster and more accurately has penetrated every aspect of our lives. Warehouses are the latest facilities to begin springing up loaded with smart technology. One of the greatest benefits for companies with these warehouses is the lower operational cost. 

Robots and drones handle most of the work, keeping human interference to a minimum for a smoother and much more efficient operation. Picking and shipping are done quicker, and fewer packing errors are made. 

Here are some other key features offered by smart shipping warehouses!  

Warehouse Management System (WMS)

This software improves inventory management, maximizes storage by suggesting where products should be placed, and records the process of receiving, stacking, and picking products.

First-In First-Out (FIFO) 

This is basically the first-come, first-served approach to shipping. The items received first are the first to be selected for delivery.

First-Expiry First-Out (FEFO)

Perishables with the earliest expiration date are picked first.

Last-In First-Out (LIFO)

The last item received is the first picked for shipping. This principle is usually reserved for preferred customers. 

What Is Warehouse Racking?

Warehouse racking is a storage solution that permits products to be stacked on multi-level shelves in horizontal rows. Most racking systems are designed to hold standard 48×40 inch pallets full of boxes or goods. 

However, if you aren’t shipping items on standard-sized pallets or your business deals with pipes, timber, and other long, cumbersome objects, you need to know they have a racking system to accommodate your needs. 

Shipping Warehouse Operations

A shipping warehouse fulfills several tasks for the shipper, from sorting to packing and labeling shipments. That’s why they’re often referred to as fulfillment warehouse shipping centers.

Once the order is received, several steps are taken before the customer receives the product. The following explains what’s involved during each stage of the process.

Manage Order Information

Once the customer places their order, a copy is sent to the shipping warehouse. Inventory is checked to ensure the product is available, then the shipping address is verified. It’s grouped with other orders sent to that address and prepped for pick up.

Packing Process

The product is located, picked, and packed with the appropriate packing materials at this stage. Next, the shipment is weighed, and a carrier is chosen. 

Some companies offer multiple carriers to their customers, so the information should be double-checked to ensure the customer’s preferred delivery carrier is selected. The package is labeled and ready for the final step of the process. 

Finalize Shipment

This is where the shipment is handed over to the delivery carrier, and the shipping information is updated. The customer and company that owns the product are notified that the order has been fulfilled.

Common Shipping Errors

There are a number of things that can go wrong at the warehouse to delay a shipment’s delivery. This list is just a few of the most common shipping errors.

  • Inventory discrepancies
  • Damaged goods
  • Picking errors
  • Shipment handed to the wrong carrier
  • Incorrect label printed
  • Inefficient warehouse layout
  • Warehouse safety hazards

Fulfillment Center vs Shipping Warehouse

While a shipping warehouse and fulfillment center seem to perform the same function, there is a slight difference in their operation. A fulfillment center, like the ones used by Amazon, is usually owned by a retailer to meet the immediate needs of their customers. 

Fulfillment warehouses are constantly active with employees picking, sorting, and packing shipments. Inventory is also received and placed on the appropriate racks, and they also handle returns. The fulfillment center is expected to provide the customer with a pleasant experience as they handle everything from the moment the order is received.

Warehouses are more focused on storing items for long periods. But, a shipping warehouse offers to prepare and package the item when you receive an order. They don’t handle returns or other customer service issues like a fulfillment center.  

Leave the Shipping to Them

Whether you’re running an eCommerce website or a brick-and-mortar location, partnering with a shipping warehouse can alleviate a lot of stress in your life. Storing boxes at home or in your store and scrambling to get them packed and picked up on time can be inconvenient and inefficient. 

Why not allow a third party that specializes in the area to take on the responsibility while you focus on expanding your customer base instead? It’s a win-win situation for everyone involved!


What are shipping warehouses called?

Shipping warehouses are also known as distribution centers or fulfillment centers.

How big is a shipping warehouse?

Their sizes vary widely, ranging from 20,000 to 2 million square feet.

What is the shipping process?

The shipping process involves receiving, storing, and dispatching goods. It often includes inventory management, packaging, and transportation logistics.

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