Warehousing and Distribution
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Warehousing has existed for centuries to hold goods, either raw materials or finished goods, in inventory. It serves the purpose of having products available to consumers when they need them. It represents another cost factor in distribution, as storage costs and financing costs apply, and additional cargo handling can result in product damage and pilferage costs.
Distribution in modern business has changed for efficiency reasons, and distribution centers and fulfillment houses have largely replaced warehouses. These large and modern buildings can be owned and operated by the marketing organization or a third-party logistics provider, known in the shipping industry as "3PLs".