Exploring Dedicated Warehousing Models: Which one is right for you?

Review the models for dedicated warehousing, and determine the best fit for your business

Amidst the rise of nimble multi-client and omnichannel fulfillment centers, there are still distribution models that warrant a dedicated, big-box warehouse. In today’s blog post, we’re exploring three models for dedicated warehousing.

Model 1: Full-Service Dedicated Warehousing

This model provides a complete range of warehousing services, including storage, handling, picking and packing, and shipping. The 3PL takes care of all the operations, allowing the company to focus on its core business activities.

Is a Full-Service Dedicated Warehousing right for you?  Here are some key questions to ask yourself:

• Do you have a large enough volume of inventory to justify a dedicated warehouse?
• Do you have high inventory turns?
• Do you have special orders that require value-added services like packaging, customized labeling, or kitting? 
• Do you have a limited depth of expertise inside your organization for warehouse management?  
• Do you want to forego the investment in WMS technology and have a 3PL provide it instead?

If you answered “Yes” to at least 3 of these questions, this model is worth exploring further. 

Model 2: Cross Dock Dedicated Warehousing

This warehousing model is designed for companies that have a high volume of inbound and outbound shipments. The 3PL receives the incoming products, sorts them, and immediately sends them out to their final destinations.

Is Cross Dock Dedicated Warehousing right for you?  Here are some key questions to ask yourself:

• Do you have a high volume of inbound and outbound shipments?
• Do you have a number of shipments that require consolidation and deconsolidation?
• Do your bulk shipments need to be broken apart for multiple destinations?  
• Do you have a transportation savings initiative to consolidate multiple shipments into full truckloads? 
• Do you have customers with wide variations in shipment requirements (ie. pallet-only deliveries versus case deliveries, etc.?)  

If you answered “Yes” to at least 3 of these questions, this model is worth exploring further. 

Model 3: Contract Dedicated Warehousing

The contract dedicated warehousing model is similar to full-service warehousing, but with a longer-term agreement between the company and the 3PL. The company retains more control over the warehousing operations, and the 3PL provides support and expertise.

Is a Contract Dedicated Warehousing right for you?  Here are some key questions to ask yourself:

• Do you own an existing warehouse but lack the expertise and in-house talent to properly run it?
• Have you invested in an existing WMS or ERP technology platform that you wish to retain, even though you want to outsource your warehousing operation?
• Are you having difficulty sourcing warehouse labor in the local area where your warehouse is?
• Are your costs going up, with limited or no opportunities to identify continuous improvements and efficiencies?
• Are you dissatisfied with your current 3PL’s performance in your Contract Dedicated Warehouse?

If you answered “Yes” to at least 3 of these questions, this model is worth exploring further. 

Verst announces the opening of a new Dedicated Warehousing site

Any of the models we’ve explored today could be deployed at Verst’s newest dedicated warehousing project in Dry Ridge, Kentucky. This is a rare chance to get into a new dedicated warehouse pre-construction with more than 1,048,000 square feet in the heart of the nation. The new facility offers dedicated warehouse space that can be built to suit — with a mid-2024 delivery. Customers have the option to manage their facility themselves or outsource warehouse operations to Verst. 

Why Verst for Dedicated Warehousing?

Verst operates a Dedicated Warehousing network with locations that reach 65% of the U.S. population within a 600-mile radius. We’ve made contract logistics, shipping, and freight easy with central locations that are served by:

• 5 commercial airports
• 19 interstate highways and parkways
• 4 major shipping hubs, operated by UPS, FedEx, Amazon, and DHL
• 4 dedicated warehouses served by Norfolk Southern Railroad
• Several ocean-going container ship ports and numerous barge terminals on the Ohio River

Verst’s Dedicated Warehousing and Contract Logistics management team has a deep understanding of the operational needs required to successfully manage an operation from start to finish. Verst was recently named a Multichannel Merchant’s Top 3PL for 2023. Because we understand what’s most important to our clients, we carefully track critical key performance indicators (KPIs) for every operation, including inventory accuracy, on-time inbound and put away on-time order ship, and outbound accuracy. Finally, our team approach to managing our client’s dedicated warehousing performance includes a Verst executive sponsor, a commercial lead, and an operations lead who is a single point of contact. 

Need advice for an exceptional Dedicated Warehousing solution from our team?  Visit us online or call our warehousing experts at 800-978-9307.