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3 benefits of using bonded warehousing

Posted on 08.08.2019

Thanks to exponential growth in new, digitally driven sectors such as e-commerce, the demand for reliable warehouse space has never been higher.

As changing international markets cause demand for goods to rise in regions many companies may not be familiar with trading in, there is an increased emphasis on finding ways to circumvent the punishing tariffs and export-import taxes these countries have developed.

This is especially relevant for newer businesses who are trying to broaden their customer base without sacrificing growth-inducing profit. Bonded warehousing offers a solution to these issues, providing a number of benefits to entrepreneurial suppliers looking to expand their business. Listed below are some of the benefits that come from using a UK bonded warehouse to manage import services.

1. No duty payments needed

Bonded warehouses are essentially locations where imported goods are stored or manipulated without the importer or warehouse owner having to pay duty. This includes import duty on any products traded or purchased internationally, all of which is deferred until the item leaves the facility.

This has the obvious benefits of allowing the importer to save money and maintain better control of their finances, as the immediate upfront costs of imported goods is reduced by around 20 to 30%. The knock-on effect of this will be increased business turnover and subsequent growth.

2. Long-term storage

Some goods, depending on the type of company, require extremely long holding times. Whether this is to store goods ahead of peak seasons when demand is expected to rise or to fit the expectations of a customer’s schedule, there exists a myriad of reasons why stock would need to be held.

Bonded warehousing provides that long-term capability, with variations from county to country on how long those goods can be held. In the USA, imported goods can be stored for up to five years, but in some countries, there is no storage time limit.

3. Managing restricted items

Inventory Management is difficult enough without the added pressure of navigating the complexities of trade laws. Bonded warehouses can be used to store goods that are subjected to special restrictions, such as alcohol or pharmaceuticals.

Storing them in these locations, which often features specialised facilities such as deep freeze vats, gives you time to handle the necessary Import and Export Documentation or until you fulfil whatever requirements are needed to safely move your goods to the next stage of their journey.