Association of Progressive Rental Organizations | America’s Champion for Rent-to-Own

Should You Be Warehousing Product?

Among the myriad uncertainties COVID-19 has produced, supply-chain insecurity has been a key issue for the rent-to-own industry. As the virus continues to surge higher, many companies are warehousing product either more than ever before or for the first time.

We talked with Dan Fisher, Vice President of Majik Enterprises International Inc., dba Majik Rent-to-Own – an APRO member which operates 13 locations around Pennsylvania – about how his business is using its warehouse to keep product supply more reliable during the pandemic.

APRO: Has Majik Rent-to-Own traditionally warehoused product?

DF: We’ve had a warehouse for about a decade, with its main purpose being just to receive special truckload or container offerings that couldn’t be shipped directly to stores.

APRO: How has Majik’s warehousing policies and processes changed this year?

DF: With the coronavirus-related supply challenges, we’ve begun ordering large quantities of products to our warehouse, in order to keep product flowing to our stores. The biggest difference is that we now ship almost everything to the warehouse, and then to stores, since we never know when something will be coming to us.

To be honest, we’ve often debated cost versus benefit with our warehouse, but during the pandemic, it has been invaluable. I feel sure our stores would have been empty on-and-off during the challenging year we’ve had – but thanks to our warehouse, we’ve had significant stock available to us all year long.

APRO: How optimistic are you about the certainty of the supply chain going into 2021?

DF: I’m not great at forecasting the future, but I think the supply chain will continue to be unpredictable through Q1 and Q2, and hopefully begin to normalize by Q3 or Q4. With the recent COVID-19 resurgence, people will be out of work – which is a big cause of delays. And our suppliers are already backed up by months, so that’s not going to improve and will likely get worse.

APRO: Is warehousing product an activity Majik will continue to do beyond coronavirus, or do you think this solution is situation-specific?

DF: While we had considered eliminating our warehouse many times in the past, we will definitely maintain it moving forward. For now, we’ll continue to ship most everything through our warehouse, and once the supply chain returns to normal, we’ll probably return to our “opportunity buy” warehousing strategy.

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