Warehousing is a traditional term that describes the act of storing goods that will be sold or distributed later, typically in a building that is specifically designed for this purpose.
The need for warehousing is driven by various factors:
More frequently in the 21st century, as the function of logistics in supply chains has become more complex, and the fulfilment of orders has become a customary supplement to storage, these warehouse buildings have become known as logistic centres, distribution centres, and/or fulfilment centres.
Whether the purpose is strictly storage, or storage plus order fulfilment, warehouses use specific elements that help manufacturers, distributors, and retailers monitor inventory and store it safely.
Typically, a “warehouse” comprises some basic elements:
The six fundamental warehouse processes comprise receiving, putaway, storage, picking, packing, and shipping. To maximise efficiency a first-class warehousing operation will optimise these six processes.
There are principally two types of warehouse – Private Warehouse and Public Warehouse:
These are generally owned by traders - being manufacturers, wholesalers, retailers, or distributors and are used to store exclusively their own goods. Typically they are operated by the traders themselves, or on a dedicated basis by specialist logistics service providers under outsourcing contracts.
These warehouses are usually privately owned and made available for use by traders on flexible terms. They are operated by warehouse keepers, who in the modern world are known as logistics service providers and are flexible enough to store several kinds of products. These warehouses can be cost effective as the user pays only for the space they occupy, plus any additional services provided by the logistics service provider.
In some countries, for example India, public warehouses may be owned and operated by central or state government, providing storage for private companies and government agencies, in many cases to control supply and demand dynamics and maintain price stabilisation over bulk commodities such as rice and grains.
In the UK around 120 million square feet of public warehousing, spanning some 3000 locations nationwide, is provided by some 650 logistics service providers who are members of the country’s leading trade association for the warehousing and logistics sector – the UK Warehousing Association (UKWA).
Members of UKWA provide warehousing and ancillary services under the association’s Terms & Conditions of Contract, giving members and their customers the reassurance that they are protected and contractually compliant under a recognised legal framework.
In the UK a Customs Warehouse is either a Private Warehouse or Public Warehouse formally approved by HM Revenue & Customs, where goods can be stored to delay payment of import duty and VAT. Payment of duties and taxes are payable when the goods leave the warehouse and go into free circulation, or are moved to another customs procedure, or can be avoided entirely if the goods are re-exported.
Companies seeking approval as an Authorised Warehouse Keeper must
Applications to HMRC require the following information
An excise warehouse is any place of security approved by HMRC where goods liable for excise duty can be stored without payment of the duty for such periods and subject to such conditions as they see fit.
If you’re based in the UK and intend to receive, store and dispatch ‘free circulation’ excise goods in duty-suspension, you’ll need to have your premises approved as an excise warehouse, which is a specific type of tax warehouse.
As the operator of the excise warehouse, you will also need to be approved as an authorised warehouse keeper.
Excise duty is suspended whilst goods are held in an excise warehouse but you must get permission from HMRC if you intend to store duty-suspended and duty-paid goods in the same premises.
The 3 categories of excise goods that can be held in an excise warehouse in duty-suspension are:
HMRC does not allow UK manufactured tobacco products intended for use in the UK to be stored in an excise warehouse. Such goods can only be warehoused if they are intended for a duty-free purpose such as:
The UK Warehousing Association (UKWA) is Britain’s leading trade organisation representing the country’s warehousing and third-party logistics (3PL) sector. Whist driving up industry standards by helping members operate safely, ethically and profitably, its role as the voice of the UK logistics industry is to further the interests of the sector, with a range of activities to identify major issues, champion change and represent members’ views to government policy makers and influencers.
The Association’s 800+ member companies operate some 12 million square metres of warehousing from around 3000 depots across the UK. Until recently UKWA membership predominantly comprised third party warehousing and logistics service providers, together with a marginal number of suppliers of goods, services and specialist advice to the logistics industry in the category of associate members. Now a growing number of logistics users such as retailers, manufacturers and wholesalers are joining the association’s recently formed Logistics Users category.
Having celebrated its 75th year in 2019, the purpose of UKWA has seldom been more significant than the present time. Through a range of activities, events and communication channels the association is increasingly facilitating vital knowledge transfer, sharing best-practice and driving the dialogue between the logistics industry and those influencing the policies that will affect the country for many years to come.
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