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April 4, 2022

Determining the Best Inventory Storage Solution for Your Business

Determining the Best Inventory Storage Solution for Your Business

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This blog post was originally published by Deliverr, which is now Flexport. The content has been adjusted to fit the Flexport brand voice and tone, but all other information remains unchanged. With the merging of Deliverr’s services (DTC fulfillment, B2B distribution, and Last Mile delivery) into Flexport’s existing international freight and technology services, we’re now able to provide merchants with true end-to-end logistics solutions spanning from the factory floor to the customer’s door.

We get it—finding the right inventory storage solution for your business can be a challenge. Many storage solutions in-market are convoluted, requiring multiple warehouses, multiple providers, and endless points of contact for you to manage.

What works for one business might not translate well to meet your own needs. To help you determine the best storage solution for your business, we’ve compiled the three primary solutions to store inventory and properly manage it—self-storage, traditional warehouses, and partnering with a 3PL (third-party logistics).

Breaking down the three types of inventory storage solutions

Before starting your decision-making process, it’s important to first evaluate the size of your company. Most businesses utilize self-storage while they are first starting out, but as your business grows, you’ll likely need to turn to traditional warehousing or outsource fulfillment to a 3PL.

Get a glimpse into your options and weigh the pros and cons of each storage solution below:

1. Self-Storage

Self-storage is exactly what it sounds like—storage that you manage yourself. For that reason, this type of storage solution is primarily chosen by those that are just starting out or have minimal inventory. Likely, self-storage will be located in the back of your business, in a closet, or even at home.

The Pros: Low cost, great for small businesses or businesses just getting started, the best short-term or “in-between” solution, and often 24-hour access because you’ll have your inventory right at your fingertips.

The Cons: Items can be hard to find, which can lead to storage miscalculations, Additionally, there’s a higher risk of damage or loss with this type of storage solution, which can become unsustainable as your business grows.

2. Warehouse

As your eCommerce business grows and becomes more established, you’ll need more space to store your inventory. When you’re fulfilling more orders each month, traditional warehousing is a good solution. Choosing a traditional warehouse means that your business will pay a fee to utilize a location to keep your inventory.

The Pros: Uses less office space, provides room to expand, more professional than self-storage.

The Cons: You need to hire a team to fulfill orders and you might not fill the entire warehouse, which adds to your costs. On the other hand, you might run out of space quickly and have to find an additional storage solution which can incur unanticipated additional costs as well.

3. Third-Party Logistics Company (3PL)

Storing inventory with a 3PL provider is the best option for most businesses. 3PLs offer a full range of eCommerce logistics services, including storage, fulfillment, warehousing, order processing, freight, prep, returns, and more.

3PL storage is great for businesses of all sizes that want or need to outsource their complex inventory storage needs. When partnering with a 3PL, you have a team of people helping organize all storage processes—inbounding, communicating with the warehouse, managing providers, tracking, etc.—so that you have more time to focus on what’s most important to your business.

The Pros: 3PL storage is an easy storage solution that helps increase your productivity in other areas. This inventory storage solution also boasts fast and reliable shipping, provides access to tracking and management tools, optimizes deliveries, and helps save on shipping costs.

The Cons: You have to be willing to give up control of your inventory and trust that the provider will meet set SLAs. Check if your provider has a strong track record of reliability and stands behind their SLAs.

How can Flexport help?

Flexport Reserve Storage: Unified Storage to Connect Your Inventory to Your Demand

In 2022, Flexport is introducing a series of logistics services that enable you to create your own unique logistics infrastructure. With Flexport Reserve Storage, you have access to a unified inventory storage solution that connects inventory to demand, across any channel, any time, anywhere. Stand-alone or combined with other Flexport services, Reserve Storage is the first storage solution of its kind that has:

• The ability to store and ship anywhere: Choose from multiple options for inbound and outbound across the country, including B2B, FBA, eCommerce, your own warehouse or fulfillment center, and more.

• Transparent, straightforward pricing: Get predictable supply chains and forecasting pay-as-you-go for stored inventory and pallet-by-month pricing—saving you headaches and costs.

• One inventory partner for a hassle-free experience: One vast storage network, one point of contact, one invoice, and real-time visibility means you can focus on growing your business instead of on your own logistics.

Flexport Reserve Storage takes into account all combinations of inbound and outbound for an inventory flow so flexible it’s a competitive advantage. Your products will get to their destination way faster and at a much lower cost to you than with multiple 3PLs handling this. Whether you’re using Flexport Fulfillment, FBA, B2B, or your own warehousing—it all works with Flexport Reserve Storage.

Want to learn more about how Flexport Reserve Storage can work as your next inventory storage solution and turn your logistics and fulfillment into a competitive advantage? Check out our recent product release for more information, or provide us with a little information about your business below and we’ll schedule time to chat!

Talk to us about your storage needs

Learn more about inventory management and additional logistics services topics below:

• How to Localize Your Inventory for Faster Shipping in 2022 & Beyond

• Why Is Inventory Management Important for eCommerce Merchants?

• How to Overcome the Complexities of LTL Freight

The contents of this blog are made available for informational purposes only and should not be relied upon for any legal, business, or financial decisions. We do not guarantee, represent, or warrant the accuracy or reliability of any of the contents of this blog because they are based on Flexport’s current beliefs, expectations, and assumptions, about which there can be no assurance due to various anticipated and unanticipated events that may occur. This blog has been prepared to the best of Flexport’s knowledge and research; however, the information presented in this blog herein may not reflect the most current regulatory or industry developments. Neither Flexport nor its advisors or affiliates shall be liable for any losses that arise in any way due to the reliance on the contents contained in this blog.

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