Definition
A warehouse is a building for storing goods and services until the need for them arises. A warehouse is also usually referred to as a go down, silo or depot.
Warehousing is the process and the systems for relieving goods, protecting them against all types of hazards and ensuring their availability to those who need them. Therefore, it involves three main processes:

1. Receiving goods into a warehouse;
2. Storing them
3. Releasing them to the users.

Thus, warehousing helps to create time utility and is therefore classified as an ‘aid to trade’.

In order to be as effective as possible, warehouses require some features and resources. These include:

1. Proper buildings suitable to house various types of goods;
2. They should be conveniently located to enhance accessibility by the users;
3. Proximity to a good transport network system to ensure smooth movement of goods in and out;
4. The warehouse should be equipped with appropriate protection equipment to keep the goods safe from water, sunshine, human animals, excess heat and such factors;
5. It should be spacious enough to enable both storage of goods and movement of goods and personnel;
6. It should be equipped with proper facilities for handling goods like forklifts and an necessary working materials and tools to facilitate operation;
7. It should be equipped with adequate facilities to care for goods for instance coldroom facilitates for perishable goods;
8. It should be manned by well trained staff for efficient delivery of services;
9. The warehouse should be equipped with an efficient communication network.
10. A warehouse should conform to the law of the land.
11. It should have proper recording system to monitor movement of goods.

​Warehouses are usually categorized on the basis of ownership or types of goods stored.

Private Warehouses
These warehouses are owned by individuals for storing goods. They include:

1. Wholesalers warehouse – they enable the wholesalers to buy goods from the producers in bulk and prepare them so that they will be ready whenever the retailers need them;
2. Producer’s warehouses – they store producer’s goods before the goods are released to the market. They are most conveniently located near the producers or their clients.
3. Retailers – they are commonly owned by some large scale retailers like the chain store and supermarkets to suit the purchase of goods in large quantities and sell them gradually.

1. When there is low volumes the resources may become underutilized;
2. High initial cost of production;
3. The owners may suffer some problems associated worth small scale firms like lack of enough funds to employ adequately qualified personnel.

Public warehouses
The term public implies that these warehouses can be used any member of the public to store his/her goods whereby the owners of the premises lend parts or the entire warehouse to any individual. To enhance versatility and suitability, the owners site the warehouses strategically near ports. This is because they are most commonly used by importers or exporters.
Many public warehouses offer some additional services like packaging, clerical services, market reports, preparing export samples and insuring the goods. Ownership of the goods in the warehouse is usually proved and transferred from one owner to another through a document known as a warehouse warrant. This enables the owner of the goods to sell goods in the warehouse without having to physically transfer them from one place to another. 

These types of warehouses are categorized on whether they house goods awaiting tax or tax free goods.
Bonded Warehouses
They store imported goods prior to payment of the duties. The warehouse owner’s offers cash guarantee to assure that the goods will not be released before clearing the duties. Goods under transit to another country may not attract duties, including those that are packaged outside the warehouse. The goods may be sold inside the warehouse and the new owner undertakes the payment of the taxes. Once cleared, the owner is issued with a warrant of release.

1. The importer pays rent for the space of goods;
2. In case the importer fails to pay the duty, the custom authorities may be auction the goods;
3. Withdrawing goods from the warehouse in bits ends up with a higher total tax than a one off fee.

Free Warehouses
Goods in these types of warehouses are not under the control of the custom authorities. The goods do not have any pending tax. These include locally manufactured goods or imported goods whose duty has been cleared.

Driven by technological inventions, warehouses are undergoing revolutions such as:

1. Computerised monitoring systems are tracking the goods inside and outside the warehouses;
2. Conveyor belts and other mechanisms are replacing manual movement of goods in the warehouses;
3. Newer designs with improved storage capacities are coming up;
4. Better storage facilities like the use of racks is being employed in the warehouses;

1.         1995 P1
Outline four features of a bonded warehouse (4 marks)
2.          1995 P2
Explain five ways in which warehousing facilitates trade.
3.         1996 P1
Highlight four ways in which a warehouse is useful to a trader. (4 marks)
4.         1997 P1
List three advantages of warehousing to a manufacturer. (3 marks)
5.          1997 P2  
Lobo Traders intends to consult a warehouse. Explain five measures that
Lobo would take to ensure smooth functioning of the warehouse
6.         1998 P1
Outline four benefits that consumers get from a warehousing (4 marks)
7.         1999 P1
Outline four factors that a trader would consider in locating a warehouse. (4 marks)
8.         2000 P1
State four benefits that a government gets from a bonded warehouse. (4 marks)
9.          2000 P2
In what ways does warehousing facilitate trade in a country?
10.       2001 P1
State four features of a bonded warehouse (5 marks)
11.       2002 P1
State four advantages of public warehouse to retailers. (4 marks)
12.       2003 P1
The table below contains descriptions relating to some types of warehouse. In the space provided, write the type of warehouse to which each description refers.

13.       2004
In which four ways are consumers likely to suffer in a situation where there is no warehousing?
14.          2007 Q13 P1                          
Outline four benefits to a business that uses its own warehouse. (4 marks)
15.          2007 Q6a P2
a) Explain five features that you would consider in establishing a warehouse for    imported goods. (10 marks)
16.          2008 Q3 P1
State four ways in which a warehouse is of importance to a manufacturer. (4 marks)
17.   2010 Q3 P1
Name the types of warehouses associated with each of the statements given below: (4 marks)