Warehousing and Distribution

Warehousing and distribution is a logistics capability that covers the storage, management and movement of materiel. It includes receiving goods, storing them, controlling inventory and delivering supplies to the units and users who need them.

The term sits within military logistics and supply-chain management. Defence organizations usually describe warehousing and distribution as related functions, and buyers often combine them in one service requirement. Related terms include supply, storage, inventory management, replenishment, transportation and receipting.

How NATO and the U.S. Army describe the functions

NATO describes logistics as supporting the supply, movement and maintenance of equipment, personnel and services. Its supply function includes determining stock levels, provisioning, distribution and replenishment. The full description is on the NATO page on its role in logistics.

The U.S. Army defines distribution as a system of facilities, installations, methods and procedures for receiving, storing, maintaining, distributing and controlling military resources from receipt to issue. That definition, published in an Army article on globally responsive logistics, shows that storage and delivery are treated as one flow rather than two separate activities.

NATO also lists distribution, handling, transportation, management and warehousing among the civilian logistics activities in its areas of work for young professionals.

What warehousing covers

UK Defence logistics policy treats warehousing as an inventory-management function. It includes storing inventory, managing storage locations, stocktaking inventory and managing losses. The policy is set out in JSP 886 Volume 2 Part 9.

In practice, a warehousing requirement is about accurate records and secure custody as much as shelf space. The buyer needs to know what is held, where it is held and what has been lost.

How distribution moves goods to the user

Distribution is the delivery side of the capability. UK Defence logistics procedures describe defence storage and regional distribution centres as intermediate delivery points between suppliers and the units that demand goods. Those procedures appear in JSP 886 Volume 2 Part 7.

Under this model, a supplier does not always deliver to the end user. Goods can pass through a distribution centre or consignment point first, and receipting at each stage keeps the record of what arrived.

How allied governments contract for the capability

Allied defence buyers have bought warehousing and distribution as outsourced services. The UK Ministry of Defence has described a logistics contract covering warehousing, freight distribution and storage-information services, announced in its defence support transformation news release.

The UK Ministry of Defence has also described military-logistics contracting that involves warehousing procurement, stock control, storage and distribution for food, clothing, general supplies and medical supplies. That scope is outlined in the announcement of the contract to run military logistics.

These examples show the usual bundle of services: facilities, stock control, freight movement and delivery.

What it means for a supplier bidding on Canadian public contracts

When a Canadian solicitation uses warehousing and distribution language, read the statement of work closely, because the obligations come from that document and the resulting contract. Check the requirements for warehouse facilities, inventory records, order fulfilment, packaging, transportation, delivery locations, security, hazardous materials and performance reporting.

Confirm whether the buyer expects you to hold stock, to move it, or both. Also confirm whether goods flow through intermediate points before reaching the end user, since that changes your delivery and record-keeping duties. Your bid should map each of these functions to a named process, location and responsible person.