For many people, the difference between a warehouse and a distribution center may not be obvious, but for anyone in the logistics industry, the two concepts are unmistakable. At first glance, a distribution center and a warehouse may seem similar when it comes to storing goods, but the internal operations and responsibilities of the two concepts can be very different.

1. Warehouse

A warehouse is a commercial building used to store goods – mainly used by manufacturers, importers, exporters, wholesalers, and transportation businesses. Warehouse is used for the purpose of storing goods only.

Some warehouses have specific temperature control requirements that are suitable for storing groceries, other fragile foods, and other materials including ingredients, food packaging, spare parts, and more and more. While warehouses can be useful to some, not all retailers use them as they are preferable to those looking for a longer-term storage option.

2. Distribution Center (DC)

The distribution center itself is first and foremost a warehouse, but besides the function of storing goods, this center also performs a very important function which is to deliver goods according to the orders of the business. goods owner.

Currently, in order to save and maximize the land area for the expansion of production facilities, some businesses rent out warehouses instead of building their own warehouses in factories. Similarly, a distribution center can be a division within the business, or it can be an independent department that stores and distributes goods for the business.

Distribution centers are often located in easily accessible areas, such as near major roads and highways; This makes truck transportation easier and the loading and unloading process more efficient.

3. Distinguish distribution center and warehouse

Purpose: Warehouse can be used to store goods for the long term while a distribution center only stores the required quantity of the right product in right place at right time.

Value-added services: Warehousing only provides services exclusively for the storage of goods and does not provide value-added services exclusively for the storage of distribution centers such as cross-docking, order fulfillment, packing, etc......

Processing time: Distribution centers store products for a relatively shorter time than warehouses. Therefore, the flow rate through the distribution center is much greater than that of the warehouse.

Customer focus: A distribution center is a bridge between the supplier and the customer. While the role of a warehouse is to store products, the role of distribution centers is to efficiently respond to customer requests.

Complexity: Operations at a distribution center are much more complex than at a warehouse. As a result, distribution centers are equipped with the latest technology for order processing, warehouse management, shipping management, etc.

Source: supplychainminded.com