Outsourcing has been a hot topic in the world of business for a long time now, and that goes the same for warehousing as it does anywhere else.

Outsourced warehousing has become an increasingly popular way for warehouses to disperse their stock and quickly gain additional working space at a much lower cost than moving into a bigger facility or tending a second exclusive space, and under the right circumstances it can be a lifesaver.

Of course, there’s another side of the coin, and a lot of warehouses find themselves turning to outsourcing without considering the circumstances or benefits. If you need more warehouse space and are thinking about outsourcing, here’s a few questions to ask yourself before deciding on your next course of action:

Do I find myself needing to scale operations?

One of the biggest advantages of warehouse outsourcing is the ability to quickly scale your operations up or down as needed. While there’s no realistic way to predict exactly how much space your warehouse will need at any given moment, outsourcing gives you a quick way to increase space when needed—and reduce space when things get back to normal.

Do I frequently have multiple shipments from the same location?

Outsourced warehouses give you a great second location to receive or process shipments from in order to better keep up with product flow and demand. By utilizing outsourced warehouse space you can provide your deliveries with a second location for handling and receiving, which can especially come in handy during peak seasons or during times where product flow is at its highest.

Am I running out of storage space at my current warehouse?

Maybe the most commonly-cited reason for outsourcing a warehouse, lack of storage space can be a massive hindrance on operations. Outsourcing additional space can be a much more cost-effective way to increase your current space, even if it needs to be outfitted with its own warehouse shelving to accommodate the items you need to store. Of course, the pros and cons of this approach need to be weighed—in many cases, lack of storage space can be easily remedied by careful reorganization of the current shelving and storage solutions you have, but outsourcing is still a much more cost-effective solution to many warehousing problems.

Do I have short but frequent peaks in capacity demands?

In a similar vein, a lot of warehouses resist the idea of expanding or moving into new facilities due to peaks in capacity and sales; in many cases the costs of moving into a bigger warehouse are outweighed by the frequency of sales peaks, but these peaks and seasonal changes can still cause a lot of headaches when they happen. Outsourcing a warehouse, or even a smaller space within another warehouse, can be a much more cost-effective solution to less-permanent demands on your space.