Question

Explain any five importance of Warehousing.

Describe the cause of growing necessity for warehousing in business.

Discuss the need for warehousing.

''Warehousing is essential in modern business." Discuss.

Give reasons for the need of storage in marketing of goods.

Discuss six reasons for the increasing necessity of storage in business.

Discuss the necessity for storage in the marketing process.

Discuss the main reasons highlighting the necessity of storage of goods.

Answer 1

1. Seasonal production: Several commodities, such as rice, wheat, sugar, etc., are produced during a particular season, but they are consumed throughout the year. For example, potato is produced mostly in winter season but is demanded throughout the year. Perishable products like vegetables, fruits, eggs, butter, etc. are stored in cold storage to make them available to consumers throughout the year.
2. Seasonal demand: Some products, such as electric fans, coolers, umbrellas, raincoats, woollen cloth, etc., are demanded in a particular season. But they are produced throughout the year. Such products have to be stored in warehouses so that the demand during the particular season can be met.
3. Production in anticipation of demand: Factory goods are generally produced in anticipation of future demand. All the goods are not sold off as and when they are produced. They have to be kept in warehouses until demand is created. Manufacturers store goods for wholesalers, wholesalers store goods for retailers, and retailers store goods for consumers. Thus, the need for warehousing arises at every stage in the marketing process.
4. Storage of raw materials: Manufacturers must store raw materials to ensure uninterrupted or regular production. Raw material prices are low during certain seasons. Manufacturers buy them in bulk and. store them for use throughout the year.
5. Stability in prices: Stability is necessary to store goods to avoid violent price fluctuations. Producers and merchants can secure better prices by storing goods in warehouses.
6. Scattered demand: Goods are produced in some places far away from different places of consumption. Goods need to be stored near the market so as to make them available to buyers whenever and wherever they are required.
7. Public distribution: Warehousing is necessary for building up a buffer stock of foodgrains. It enables the Government to supply essential commodities to the people affected by natural calamities like drought, flood, earth quake, etc. Warehousing makes the public distribution system more effective.