The Role of Warehousing in Hospitality

For each project, whether it is a Hotel new construction or renovation, there is a question on the potential Warehousing need for the FF&E (Furniture, Fixtures, and Equipment) and other product. 

On smaller projects, clients tend to take more risks, “roll the dice” and ship product directly to the site to save on warehousing costs.  For projects under 50 rooms, this is sometimes possible as the sites are more flexible to changes.

However, on larger projects, an evaluation of the added cost and value is necessary.  You can always “roll the dice” and try to ship direct to a site.  If you get lucky (and I mean very lucky!) this will work. However for projects over 100 rooms, it is simply not going to work.

Here are some issues to consider if you are planning to ship direct to the site and not use a Warehouse:

• If the site is not ready to accept the delivery truck when it arrives, there are added costs for the truck to wait to be unloaded.

• If the trucker is behind schedule and there is labor on site for the offload, there is added cost for the labor to wait on the truck.

• Depending on where the items will be staged before movement into the hotel, some items will get buried or lost,

- Sometimes a parking garage is used.  This has limited security and items can be misplaced easily.  Also it is not a controlled environment so weather can affect the product

- Sometimes ocean shipping containers are used.  The issue here is inventory control - where are the items stored and how are they loaded? Items typically get buried and you pay for added labor to unload. 

For comparison, let’s consider the benefits of strategic Warehousing:

• Warehouses are staffed during normal business hours when freight carriers deliver. If the truck is late the warehouse can flex to other work and save on labor costs.  This is very important in the case of construction delays on site as the Warehouse can hold the product for longer. 

• Warehouses are controlled environments so weather is not a factor for deliveries.

• INVENTORY CONTROL – This cannot be understated.  By shipping to the warehouse, we use our WMS (Warehouse Management System) to track all product and quantities for the project.  There are thousands of items to be stored and organized to enable “ease-of-pull” for deliveries. All arrival and delivery data is tracked reducing the possibility of items being lost and/or damaged.

• Flexibility to change.  If things slow down or speed up, the warehouse can flex based on those factors.

• When deliveries are needed, the site receives only what they need. This is in stark contrast to dealing with the inefficiency of dealing with thousands of items dumped in a parking garage, hotel ballroom, or in ocean storage containers.

• Many products for hotels are now made overseas. It is more important than ever to ensure damage control as the turnaround time for replacement is months out. Warehousing of the product ensures products don’t get handled multiple times which reduces the potential for damage.

The strategic use of Warehousing creates a controlled service that brings tremendous efficiency to the new construction or renovation of a hotel.  In particular, this is critical for the FF&E final stage. If this is not executed flawlessly there will be serious delays in producing revenue.

For more information please contact Dean Steiner, VP of Sales & Strategy, at 1-877-223-0605 or
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Dean Steiner

VP of Sales & Strategy
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