Current State and Rational Management of the Distribution Warehouses of Enterprises in Asia and Europe
Authors:   Asia-Europe Perspective Association, Kim Cheong Yeoul 
Published: June 2018

The goal of goods production lies in consumption. In his writing, 「An inquiry into the nature and causes of the wealth of nations」(1776), Adam Smith said “Consumption is the sole end and purpose of all production”. Except some special occasions, goods are usually supposed to undergo both spatial and temporal movement. The former movement has the form of transport and the latter, the form of storage. Temporal movement aims to maintain the status quo of goods, but sometimes seeks to do chemical changes in goods according to their types. To keep goods as they are, wooden boxes, glass and paper bags may be used. Warehouses are facilities in residence or buildings in factory that were created to prevent theft, flood disaster, deterioration and any other cases that can inhibit increase in the volume of goods as materials contributing to life enhancement and development.
Professor P. F. Drucker called warehousing, that is, business for physical distribution as the African continental in economics and “the third source of profits that enterprises have to take”. With other fine praises, additionally, he stressed the value of warehousing. Today, the importance of warehousing is becoming more and more and an increaing number of people are paying much attention to that field.
Enterprises's reduction in material cost may be an obstacle to their business strategy that aims to overwhelm international competitors through product quality competition rather than price competition. Reduction in labor cost may demoralize employees, provoke labor-management disputes and lower productivity. Reduction in management expenses is not easy because the smooth realization of management by objectives(MBO) as the grand cause of enterprises requests high-position officials of enterprises not to suppress business budgets and costs, or management expenses. What enterprises transact with their members is the outcome of management, not management by control, or more accurately, management by the control of its cause and process.
Only managerial area that enterprises can take the source of profits is physical distribution which can be classified into fields like transport, unloading, packing, distribution and processing, and information. The field on which this study focuses is storage, that is, warehousing that is still untouched by the studies of business administration. That field has been neither theoretically organized, nor attempted to be researched. And it is fact that warehouses have been and are still managed and operated unsystematically. To make it worse, there's little or no recognition about the need to operate and manage warehouses in systematic or organized manners. This study discusses warehousing, especially focusing on warehouses for physical distribution, as a part of efforts to promote researches on warehousing Though not certainly defined, warehouse generally means a place where physical things are stored or kept. It includes private, business, public, leased warehouses and so on. The general definition of warehouse is just made from the view of enterprises that have or use the facility, so it is not permanent.
First, the private warehouse is used to keep private materials, parts, products and merchandises from loss, degradation and damage, helping inventory management, supply-demand control, production, selling and consumption. The private warehouse may be located in a building, structure, land, underground, water surface, underwater or the air.
Second, the business warehouse is used to store things from other enterprises and keep them safe, unbroken and undamaged. It may be located in a structure, land or water surface.
Third, the public warehouse is a place where public offices or public businesses store or keep materials for the purpose of public interest. It may be located in a building, structure, land, underground, water surface, underwater or the air.