(a) State four features of a warehouse
(b) Explain six reasons why warehousing is important to a business
Explanation
a. Features of a Warehouse
(i) Convenient location It should be located as conveniently as possible to potential users e.g. near seaports, highways, central markets — good road network.
(ii) There should. be adequate mechanical appliances and facilities for loading, unloading and refrigeration
(iii) Spacious accommodation to facilitate easy movement of goods, equipment and people.
(iv) Adequate parking space inside the premises for free movement of vehicles, container trucks etc.
(v) Effective security arrangement should be provided to prevent theft and burglary, fire and protection of goods from rain, sunlight, wind, pests etc.
(vi) Availability of office space for administrative staff.
b. Importance of Warehousing to a business
(i) Protection of goods against theft and fire.
(ii) It ensures regular flow of goods to the market thus helping in stabilizing prices
(iii) It facilitates continuity in production as it permits precautionary holding of inventory to respond to market conditions.
(iv) It reduces risk of loss as warehouses guarantee the good condition of goods in their care.
(v) It promotes sales by allowing prospective buyers to inspect goods while in the warehouse
(vi) Some goods are blended, graded and labelled while in the warehouse.
(vii) It is revenue generating for government and individuals who own private warehouses.
(viii) It enables the owners of goods in bonded warehouse to pay the duty gradually as they sell the goods.