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Warehouse Storage

Zenyx Griffiths

Written by Reviewed by Dave Sayce

13th Jan 2022 (Last updated on 23rd Mar 2022) 7 minute read

If you're looking for a large storage area for your business, you may be considering renting or purchasing warehouse space.

Warehouses can provide you with large scale storage space - upwards of 1000 sq. ft. This is ideal for businesses with large amounts of stock or equipment and you can be safe in the knowledge that your items and stocks will be kept safe and secure.

However, businesses throughout the UK are often limited when buying or leasing warehouse space. Companies are required to take out a commercial mortgage and must cover the costs associated with owning commercial properties.

Meanwhile, leases are often long-term and prices can be high. Below we look at which businesses would benefit from renting a warehouse and how self-storage may be a viable alternative.

This article will cover the following:
  1. What are the Business Benefits of Renting a Warehouse?
  2. What Type of Businesses Utilise Warehouses?
  3. What Costs are Associated with Renting a Warehouse?
  4. How Do Self Storage Facilities and Commercial Warehouses Differ?
  5. Why Choose a Self Storage Facility Over a Commercial Warehouse?
  6. How to Find a Self-Storage Company

What are the Business Benefits of Renting a Warehouse?

A warehouse is ideal for businesses with large quantities of goods, products and equipment. From high-level security to acquiring additional space, warehouses can be an asset to both growing companies and established businesses.

Below we take a look at some of the top reasons companies use warehouses and how it benefits their organisation:

Location and Accessibility

    Although warehouses will likely be further out of city boundaries to accommodate the amount of space required, most will be accessible via main roads. This makes collecting and delivering stock convenient and hassle-free.

    Additional Storage

      Another benefit is the sheer amount of storage room a warehouse offers. If you are a large-scale company or your business is rapidly growing, this can be a huge advantage and will not limit your expansion.

      Leveraging Seasonal Growth

        The space a warehouse offers enables companies to increase stock levels to prepare for a spike in customer orders during seasonal shopping events such as Black Friday, Cyber Monday and Christmas. Companies that provide seasonal items such as garden furniture or ski equipment would also benefit.

        Risk Management and Security

              Businesses can minimise loss from theft, fire and damage by storing their goods in a warehouse. Furthermore, your items will be covered by insurance if you are renting the facility.

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              What Type of Businesses Utilise Warehouses?

              Businesses that benefit from renting or purchasing commercial warehouses are usually large-scale companies with extensive quantities of stock. Many of these companies produce or acquire goods in anticipation of demand and need somewhere to store the items until they receive orders for their products.

              Other companies that would benefit from renting warehouse space may have large or substantial amounts of equipment that requires more space than a standard storage unit can provide.

              These types of companies include:

              • Manufacturers
              • Importers
              • Exporters
              • Wholesalers
              • Transport businesses
              • Retail companies
              • Large online selling businesses
              • Customs

              What Costs are Associated with Renting a Warehouse?

              Renting a warehouse will come with a higher price tag compared to a traditional self-storage unit - and if you are renting in and around London, prices will be higher. Data from the fourth quarter of 2020 and the first quarter of 2021 showed that London was the most expensive region in terms of prime industrial rents.

              But it is not just rent you need to consider. When agreeing to a rental contract for a warehouse you may find there are additional fees that you will need to budget for.

              Below we look at the most common types of fees associated with renting a warehouse:

              Rent Deposits

              Landlords may require a rent deposit up front which can be anywhere between 3-6 months rent, in addition to either the first month of first quarter's rent.

              VAT

              Your landlord may also change VAT on goods and services, which includes rent.

              Business Rates

              The UK government charges all commercial tenants business rates on properties they occupy, typically around 50% of the overall rent.

              Service or Maintenance Charges

              You may find that some warehouses have security, landscaping or cleaning which the landlords may charge extra for. Before committing to a contract, ensure you check what is included in the cost of the rent. This also applies to insurance and repairs within the warehouse.

              Dilapidations

              You will likely be required to return the space in good and substantial repair and condition or face a dilapidations claim from the landlord. The Royal Institute of Chartered Surveyors (RICS) estimate that the average cost of settling a claim for an industrial tenant is £7.27 per square foot.

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              How Do Self Storage Facilities and Commercial Warehouses Differ?

              Self-storage units are a practical and convenient short or long-term storage solution that can be used by both businesses and individuals. They allow clients to maximise their space without having to spend too much money.

              Commercial warehouses, however, are typically used by larger companies, usually costing more and requiring long-term contracts.

              Warehouses and self-storage units can both provide additional space and be a place to protect your equipment, stock or goods. They can both store temperature-sensitive items and be climate-controlled if necessary.

              However, despite the similarities, there are several major differences to consider:

              1. Cost

              As warehouses are much larger industrial spaces, they are often much more expensive. They require a lot more maintenance and security, increasing the price.

              For smaller companies, the size and cost of self-storage are much more manageable.

              2. Location

              Due to their smaller size, self-storage facilities are typically located on easily accessible major roads. They are often purposely built in commercial areas so that a number of individuals and businesses can conveniently access them.

              Warehouses, however, are often found outside of cities in industrial areas, due to the amount of land required to house them. As a result, you may have to travel further to access a commercial warehouse.

              3. Space

              Obviously, most self-storage units will be smaller than warehouse space. However, they do come in a variety of sizes and can store a good volume of personal items or equipment.

              As Warehouses are typically used by large commercial companies, they will have enough space to store large pieces of equipment, stock or merchandise.

              4. Security

              Whilst commercial warehouses are extremely safe, they require larger-scale security systems which can cost a lot more money.

              Self-storage also uses multi-level security systems and round-the-clock guards. Each unit will likely have a unique access code and individual padlocks. You will also have the option of using an indoor or outdoor unit.

              5. What Can Be Stored

              Warehouses typically store goods for retailers, manufacturers and other businesses. They will also be equipped with forklifts, trolleys and cranes to help customers store larger items.

              Self-storage units, however, can only store a certain amount of items, depending on the size of the rented space.

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              Why Choose a Self Storage Facility Over a Commercial Warehouse?

              Ultimately, your reason for using somewhere to store items will largely dictate whether you opt for a warehouse or a self-storage unit. For example, if you are a small business, a storage unit would be best suited for your needs.

              Below we've looked at why you may opt for self-storage over a warehouse and how self-storage can benefit you.

              1. Accessibility

              The latest Self Storage Association report found that most people looking to use self-storage units only want to travel 15-minutes or less to the facility.

              While warehouses are usually in industrial areas, many storage units can be found in and around city centres. In some cases, self-storage facilities may be reached by public transport. s

              2. Cost-Effective

              Not only are warehouses more expensive, but they also come with additional costs. For smaller companies and side projects, self-storage units are much more cost-effective.

              3. Flexibility

              Businesses that rent self-storage units have the advantage of choosing short-term storage or long-term rentals. You will have the freedom to cancel at any time or even relocate to a more convenient and strategic location.

              4. Variety of Sizing Options

              Self-storage is very versatile and, unlike large warehouses, it provides customers with a variety of options for the size of their storage unit. To learn more, read our storage unit size guide.

              5. Additional Services

              You may be able to make use of any equipment the facility has, such as forklifts and trolleys, in addition to free parking and wifi. Many storage companies will also offer additional shelving for an added fee. Many storage companies also offer to sign for and send deliveries on your behalf.

              How to Find a Self-Storage Company

              If you have decided that self-storage is better suited to your needs than a warehouse, your next step is to find the best storage provider for you.

              Through their latest industry report, The Self Storage Association found that 46% of customers found their chosen storage company through a quick internet search. This process can be even more efficient when using a comparison site like Compare My Move.

              We have a large and reliable network of removal and storage companies who are all verified by us and reviewed by you. We can match you with up to 6 trusted professionals in your local area, helping you find the best companies that can cater to your specific needs.

              Zenyx Griffiths

              Before Compare My Move, Zenyx once wrote lifestyle and entertainment articles for the online magazine, Society19 as well as news articles for Ffotogallery.

              Dave Sayce

              Reviewed by Dave Sayce

              Owner & Managing Director, Compare My Move

              Dave Sayce is the owner and managing director of Compare My Move and has over 10 years of experience in the house removals industry.