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What are disadvantages of a private warehouse?

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Disadvantages of a private warehouse include;

  • expensive to put up.
  • holding too much stock exposes a business to problems such as a fall in prices, expiry of goods, fire, fall in demand e.t.c
  • discourages specialization
  • poor arrangement can lead to contamination and inaccessibility of goods.
  • could be operating in excess capacity during low seasons which can lead to laying off some workers.
  • adds administrative costs.

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