Bonded warehouse

A bonded warehouse is a warehouse operated by a private company in a foreign country under the regulatory supervision of that country’s Customs agency. Its main advantage is to defer the payment of customs duties. Like a standard warehouse, bonded warehouses let businesses store their goods closer to foreign customers for faster delivery, with the advantage of pushing out the payment of custom duties until the goods are released from the bonded warehouse. They are used for storing imported or exported goods.

Goods stored in a bonded warehouse can be modified onsite for the local market. These modifications can include:

• Labelling
• Marking
• Testing
• Packaging
• Dilution
• Grading
• Service and maintenance

Inspection of the goods can also be performed in the bonded warehouse. Generally, there are two kinds of bonded warehouses; wet and dry. Wet bonded warehouses allow for the storage of alcohol and tobacco. Dry bonded warehouses can store most other imported goods. 

Using a bonded warehouse means you can deliver your goods closer to their final destination. It also means that duty payments can be postponed until the product has been moved. 

This system can provide significant benefits for businesses that trade across different jurisdictions. The use of a bonded warehouse can cancel out the need to pay duties, creating inventory and cash flow efficiencies.