Location of the warehouse decides how efficiently the company is going to perform all the activities in improving the profit ratio. When it comes to location, right analysis is to be done on various areas before choosing it. Let us discuss the

basic criteria for choosing a warehouse.

(i) Rent, Rates and Taxes: Cost factor will be the major point to look at as when you make any mistake here, it will affect your profit level. The basic rents and rates differ from place to place according to the warehouse located in the city area or in outer of the city, owners of the warehouse, size and facility of the warehouse. If the warehouse avails tax benefits and incentives from the government, it will be helpful for the Users. 

(ii) Workforce Availability, Labour Skills and Costs: Workforce availability, labour skills and costs are directly associated with local demographics. You cannot find the right skills at the right price everywhere in your surroundings. There should not come a workforce gap during the activities as it may reduce the customer satisfaction level and productivity of the company in major.

(iii) Roads, Highways and Traffic Flow: Accessibility to roads was also to be considered mainly as you concentrated more on location and workforce alone, and if you cannot move the product in and out on time, the business will be lost. When it comes to warehouses, trucking will be the major transportation medium for all purposes.

(iv) Proximity to Airport, Railway Stations and Ports: It may not be required for all the warehouse users. If the main consignment is to be imported by airlines, you should have your warehouse nearest to the airport to carry out the activities. For that, you have to find the best possible route to reach the airport quickly, traffic level, condition of the roads, at what time you are going to take your goods and so on. Same conditions should be adapted when you export/import via rails and ships. It helps in moving the goods as quickly as possible by cutting down the extra time & cost incurred, when the distance to reach the customer is less and it is done on time.

(v) Market and Local Environment Factors: Location which is nearby to reach suppliers, manufacturers and customers is also one of the basic points to be considered along with local environmental factors. It helps delivery to customers on time, decreased transportation costs and improved responsiveness. Local environmental factors such as weather conditions (whether the area is exposed to volcanos, floods, tornadoes and earthquakes) and local conditions (traffic congestion, noise pollution) also to be analysed.

(vi) Building Availability and Utility Costs: In case you are shifting from one location to another due to less business, you should be aware of moving from the current warehouse location another on time nearby which helps in carrying the workforce and enhancing the responsiveness as before. And when it comes to utility costs, the activities are dependent on one another. For example, refrigerated warehouses are dependent on water and electricity, which are demanding and may incur high costs for your operations.