How do Distribution Centers Work? 10 Ways They Contribute to the Supply Chain

How do Distribution Centers Work? 10 Ways They Contribute to the Supply Chain

Managing your supply chain and distribution center requires organization and management. It is a significant part of a supply chain network for storing and shipping large quantities of products and goods. But how do distribution centers work in the supply chain? In wholesale and retail e-commerce, there are a variety of ways distribution centers contribute to an efficient supply chain network.

conveyor belts in fruit factory

Source: Juice Flair/

1. Quality Assurance (QA)

Large companies may have a team of quality assurance personnel to test their products before leaving their distribution centers. Checking these products for QA contributes to assuring customers’ requirements and satisfaction. Without this process in the supply chain, it could affect customer relations and decrease your profits.

2. Order Fulfillment

The fulfillment department is part of the distribution center that stores products for customers once the order is complete. When your customers purchase a good, the process begins by packaging and preparing it for shipment. Your company may perform these processes at the warehouse for the distribution center to pick up until delivery.

3. Logistic Hub for Pickup and Shipment

Distribution centers are logistic hubs responsible for the pickup and shipment of products to customers. They contribute to the supply chain by connecting your goods to the warehouse or customers. Modernized supply chains with distribution centers provide efficiency, high performance and organization of the logistic hub processes. 

4. Streamline Operations

Operations within a distribution center rely heavily on technologies to streamline their processes. With cloud computing technology, mobile devices and automation processing, operation functions more efficiently. Organized data and information help managers make better decisions in their supply chain network.

5. Storage Management of Goods

Companies use warehouses to store their inventory and distribution centers to store ready-to-ship products. Storage management provides solutions for inventory, fulfillment processes and order shipments. Some businesses may use distribution centers operated by partnering third-party logistics entities. If so, the center may store items in industrial wire baskets to move your items until shipping.

manager walking down warehouse aisle

Source: Gorodenkoff/

Move Inventory With Durable Industrial Wire Baskets

6. Efficient Workflow

Warehouses usually do not provide solutions for shipping products. Your distribution center picks up your freight from inventory stored in warehouses. When goods reach the center, they are ready for pickup by a shipping carrier in your supply chain network.

7. Providing Kitting Services

Most distribution centers in the supply chain provide services for kitting, the process of assembling products, such as furniture. With some orders, customers may request to divide their larger shipments into smaller units. They may use industrial wire baskets or carts with wheels to move their inventory throughout their facilities. Kitting is a service that allows assembly from the manufacturers to the distribution center.

8. International Exportation of Products

If your company has a distribution center in the international supply chain, management is essential for preparing the exportation of goods. Your distribution center should have a separate operational process for exporting orders. Export operations involve proper labeling and shipping documents for freight.

9. Inventory Management

Restocking your inventory is an inventory management process that requires efficiency in the supply chain. Having enough available stock that meets the demands of your customers can contribute to revenue growth. Heavy-duty and durable pallet containers are solutions used by distribution centers and warehouses for storing their inventory.

10. Management of Product Returns

All distribution centers implement a management process for returns from their customers. These processes may include placing the returned items on the shelves in the warehouse with other inventory goods. You can use your distribution center or a 3PL partner to handle the return process. Returns and supply management are essential to the supply chain to help smooth the process in the distribution center.

warehouse workers delivering boxes

Source: Gorodenkoff/

Use Stackable Totes for Organization

Final Thoughts

Container Exchanger is a leading seller and buyer of pallet containers, industrial wire baskets and stackable totes. We offer reusable industrial plastic containers and bulk storage containers. Our services help businesses find solutions for organizing and storing their products in stores, distribution centers and warehouses. You can sell your used containers, wire baskets and totes or purchase new ones for your business.