Outsourcing warehousing can significantly reduce corporate costs
Deciding whether your staff will also provide additional and support services to your core business or whether to hire an external company that specialises in these activities is not easy.
Why are companies of all sizes increasingly choosing to outsource warehousing and related services rather than providing these activities themselves?
Geis has seen increased demand for its storage services in recent years. As Pavel Křížek, Director of Logistics at Geis CZ, says: "The range of services in demand is really large - from simple warehousing to complex contract logistics projects. We always offer our clients the solution that best suits their needs. We are also advisors and consultants. Sometimes we try to explain to them that what they require is not optimal for them.“
Companies usually start to consider outsourcing warehousing when they grow unexpectedly fast and do not have sufficient know-how, technological and personnel capacities. First they want help with storage space, warehouse management, palletizing goods and other simple activities. Then they usually add packaging, labelling, picking, returns processing and so on. Some companies get to the point of complete outsourced logistics after some time. This usually depends on the evolution of the company. Others choose to provide a comprehensive service as a whole from the outset. Not content with simple activities, they hand over responsibility for all logistics services to a third party, which, as part of the contract, ensures that the entire chain is optimised - from storage to transport to the end customer, including all related activities and services (4 PL).
An example of a simpler outsourcing is the warehousing and other related services for Antalis s.r.o. Geis provides this supplier of complex protective and packaging materials with correct and timely loading, storage, removal and, in the last phase, delivery of goods to end customers. Petr Martinek, CSEE Packaging Director at Antalis, comments on the cooperation, "We outsource warehousing and other related services to Geis. Thanks to their reliability and flexibility, we know we can rely on this service. And not only that. Customers see the carriers delivering our goods or products as our service, so Geis is directly part of our corporate reputation. That's why it's extremely important to have the right partner, which Geis undoubtedly is."
In contrast, dm drogerie markt uses Geis for all logistics services, including packaging design and complete packaging material, preparation of special gift sets and other VAT services. Radek Rottner, Head of Branch Logistics and OCR at dm drogerie markt, says: "Over the years we have been working with Geis, our online channel has grown thanks to the flexibility of Geis. This was even during challenging periods, especially during the initial waves of the spread of covid-19, when the load on online logistics in the drugstore sector was enormous. Another benefit for dm drogerie markt is the comprehensive online logistics service covering the entire agenda related to packaging and filling material. The extension of the cooperation until March 2024 is an expression of satisfaction with the services offered by Geis."
Why do companies use specialist firms for warehousing and other related services? "I often hear from our clients that they are happy that we have freed up their hands for their core business and that they still save money in the end," says Křížek. But cost isn't the only deciding factor, although it is the most common criterion. Specialists have experience, usually a broad background, and can better withstand seasonal and other fluctuations. The warehouse provider has modern equipment that, with other technologies, also significantly reduces downtime, picking and other activities.
Recently, the human factor has become increasingly important again. Not only a quick e-mail or telephone contact and comparison of offers is important for the service offer. The ideal is to form a partnership with a specialist company with synergistic effects. As outsourcing can sometimes be risky, personal contact often gives more clues. Geis CZ Sales Director Lukáš Novotný adds, "Personal contact with our customers is still very important to us as a traditional German family business. We make sure that we meet our clients and understand what they need and how we can help them. And this is best done in a personal meeting. A computer machine will never provide a personalized service."
Needless to say, all the benefits of outsourcing warehousing can be achieved with a partner that is reliable, has a good reputation, long experience across segments, market position and can respond flexibly. Only such companies can offer their customers certainty, speed and quality.
Thanks to the strategic location of its warehouses on transport arteries with a large team of core employees and its own IT solutions, Geis is able to provide clients with reliable and cost-effective services in the area of warehousing and other value-added services (e.g. picking, returns, packaging, etc.).
The company can design a solution for its clients that exactly matches their needs and can take care of the complete implementation of such a project. It always depends on the level of involvement of the external organization that the client prefers and what is optimal given the nature of the project. In any case, customers are only charged a clearly pre-defined price for variable items, so there are no misunderstandings and often abused "multiple payments".
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