Goods can be stored in a Custom Bonded Warehouse up to nine months without having to pay VAT or other custom duties, deferring this cost until it is time for the goods to be removed or sold and reducing the financial burden on the business.
Storage in a bonded warehouse does not mean the goods are inaccessible. You are usually permitted to
- divide, and
stored goods to ready them for marketing, export, or other purposes. Goods intended to be re-exported are entirely exempt from duty payment.
The importer may endorse their warehouse receiptor warehouse bond to sell or transfer the stored goods.
The importer may use the goods stored in a bonded warehouse as collateral for acquiring bank loans – before having
1. PRIVATE WAREHOUSES:
These are owned and managed by the channel suppliers (manufacturers/traders) and resellers and are used exclusively for their own distribution activities.
(a) Warehouses constructed by farmers/producers near their fields/places of work.
3. BONDED STORAGE:
These warehouses are owned, managed and controlled by government as well as private agencies. Bonded warehouses are storage facility used to store imported goods for which import duty is still to be paid. The bonded warehouses run by private agencies have to obtain license from the government.
In actual, this enables the government bodies to hold control on private firms to pay their taxes on time. Without paying duties, importers cannot take over or open the goods. Globally, it has been seen that these warehouses are found near the ports and are usually owned by dock authorities. Bonded warehouses are subject to two types of taxes: (a) Excise duty and (b) Custom duty.
4. CO-OPERATIVE WAREHOUSES:
As the very name implies, these warehouses are owned, managed and controlled by co-operative societies. These societies provide storage facilities on the most economical rates to their members only. The basic purpose to run such warehouses is not to earn profit but to help their members.
5. Distribution Centres:
This type of storage facility usually has large space, which enables fast movement of large quantities of stores for short period. While, on the other hand,
conventional warehouses hold goods for long time, say 2 months or 1 year.
These warehouses basically by nature, serve as points in the distribution system at which goods are procured from different suppliers and quickly transferred to various customers. These centers provide computerized control, which make movement of goods quick, fast and reliable.
In order to minimize delivery time, these storage facilities are found close to transportation centers. In some cases, distribution centers handle the goods for less than a day period such as in case of fast foods or perishable products. Most of the goods enter in the early morning (dawn time) and is transferred/distributed by the evening time.