Cotton warehouses play an important role throughout the supply chain in that they are the link between producers and mills. Warehouses in the United States have struggled in recent years from lower cotton production and increased reliance on exports. The goal of this study was to perform a financial analysis of a representative Texas cotton warehouse to determine the possible benefits of using new warehousing methods. Three warehousing methods were examined: 1. Large Inventory MILLNet, 2. Small Inventory MILLNet, and 3. 4-Bale Clamp Load of Bales. Financial data was gathered from multiple representative Texas warehouses. Data was also utilized from a time and machine study that analyzed the amount of time to load a container of bales from a warehouse. Capital budgeting and Monte Carlo simulation were utilized to create a baseline budget to simulate a warehouse's finances. Net income was simulated for the baseline warehouse along with each of the possible new methods. The results were determined from comparing net income of the baseline to each scenario. It was determined that each scenario contributed to small financial gains. MILLNET software was determined to have the best results. Overall, warehouses had slightly higher net income when one of the three warehousing methods was incorporated.
