(a) State four features of a warehouse (b) Explain six reasons why warehousing is important to a business

Answer Details

(a) Four features of a warehouse

1. It is a building or place used for storing goods safely until they are needed.
2. It has adequate space, shelving and equipment for handling, arranging and moving goods.
3. It provides security against theft, fire, pests and weather, sometimes with cold-storage or special facilities for perishables.
4. It is usually sited in a convenient location with good access to transport for easy receipt and dispatch of goods.

(Also acceptable: it keeps records of goods stored (stock control); it may be owned by a producer, wholesaler or the government/bonded authority.)

(b) Six reasons why warehousing is important to a business

1. Storage of goods. It provides a safe place to keep goods from the time they are produced or bought until they are sold or needed.
2. Creation of time utility. It holds goods until they are demanded, bridging the gap between production and consumption.
3. Ensures steady supply. It makes goods available all year round, including seasonal and out-of-season goods, ensuring regular supply and stable prices.
4. Protection of goods. It protects goods from damage, theft, pests and bad weather, preserving their quality.
5. Enables bulk buying. It allows a business to buy in large quantities and store them, enjoying quantity discounts and economies of scale.
6. Preparation for sale. Goods can be sorted, graded, blended, packed and branded in the warehouse before distribution.

(Also acceptable: it allows goods to be stored under bond until duty is paid; it aids price stabilisation by holding surplus.)