More than ever, consumers are looking for a quicker and more flexible supply chain and fulfillment process. The way consumers and businesses shop and purchase is rapidly evolving, especially in the midst of a worldwide pandemic.
With the rise of Amazon, E-commerce, and omnichannel retail, the way supply chain and warehousing were operating was quickly becoming ineffective and obsolete. Thus, the emergence of flexible warehousing was upon us.
The Rise of a Flexible Warehousing Model
Flexible warehousing is the ability for businesses to adapt quickly to change in their supply chains due to uncertainty, rapid evolution, adoption of new technologies, seasonality demand, and even political forces. Many are looking to a variety of flexible warehouse options, including establishing their own “pop-up” distribution centers and acquiring temporary space through short-term leases and in non-traditional spaces.
The traditional warehouse model of multi-year contracts, investment to purchase technology and labor is quickly becoming outdated.
Flexible warehousing provides an innovative alternative that is scalable, tech-driven, and meets the needs of flexibility, and provides a more short-term option. It ultimately makes it possible to competitively deliver on all the different ways customers do their shopping today and, in the future, be it online, cross-border, via retail stores, pop-up shops, or any other method yet to arise.
Flexible vs. Traditional Warehousing
While traditional warehousing usually offers complex IT integrations, manual processing of data, and a diverse legacy system, flexible warehousing makes it easier from a technology perspective.
Flexible warehousing usually provides real-time dashboard and analytics. It has unified technology across the whole network and easy to perform integrations
Flexible warehousing’s biggest difference from traditional warehousing might be its improvement of speed. Traditional warehousing usually has long-term contracts and varying terms from each provider. It also generates sunk costs from unused space and services.
Flexible warehousing improves this with a pay-as-you-go model. You only pay for space and services used. It usually provides a collective term structure across providers, so you are not getting caught up in different terms with different providers.
Another huge difference flexible warehousing improves supply chain over the old traditional model is scalability. Traditional warehousing limits growth by locations and capabilities of 3PLs. There is usually a lack of expertise in supporting new channels and biased advice given by 3PLs controlled by their capabilities.
Flexible warehousing gives access to an independent expert team. It has an expansive network that covers every size and market. It also possesses broad capabilities including storage, retail, and E-commerce.
Looking to increase flexibility in your e-commerce business? Check out our whitepaper on strategies Amazon FBA sellers can implement to gain more flexibility.