Warehouse

Warehouse is a facility where commodities meant for marketing are accepted for storage on rental basis on behalf of producers, traders and farmers. The purpose of warehousing is to ensure better price by avoiding distress sale by creating a negotiable instrument for the commodities stored to get loans from the banks and lenders, ensure continuous supply of commodities and by following scientific method of storage avoiding wastage and commodity losses due to natural calamities, pests and other problems. The Warehouse Man, the establisher of the warehouse acts as a custodian between the owner and the lender guaranteeing the quantity and quality of the commodities offered for storage . The warehouse man has to get a license from the district collector for running a warehouse and a weigher grader license for weighment and grading the commodities to assess the market value of the merchandise offered for storage and analyzes the same for storage worthiness.

Traditionally, agri products being more susceptible to damages during storage,( there is an estimation that about more than 15℅ of the agri products are getting damaged due to lack of scientific warehousing facility) and the Indian farmers were at the mercy of private money lenders for farm operations and to resort distress sale to repay the loans and in a perpetual debt trap often resulting in sale of the cland even! The warehousing facility provided an opportunity for them to avoid distress sale by keeping in warehouse, get loans from the bank to meet the expenses and sell the produce whenever market conditions are favorable.

The warehouse offers facilities of handling, transport, packing and other related ones.

Industrialization especially after 1980, required large scale imports of raw materials and machinery consisting of heavy custom duty of more than 200℅ in some cases which was a drag on the limited finances and loans of more than 24℅rate of interest. To help the industries, government of India allowed public custom bonded warehouses to keep the duty payable stocks in a bonded warehouse immediately on landing in India by submitting a double duty bond to the customs department. As said above, the warehouse man gets license from customs and acts as a custodian between the department and the importer to release stocks only to the extent of the duty cleared and it is the responsibility of the warehouse man for all safety and security of stocks offered for storage.

Warehousing and logistics cost to the production cost of commodities is on higher side in India compared to the developed nations, meaning there's a great scope for better and innovative management of warehousing and integrated logistics using modern technology. The biggest problem is the high cost of Land, structure and the manual handling, lack proper knowledge and the services of this sector need to get proper importance like other infrastructures. Please don't hesitate to contact for any further information in this regard.