Warehouse space,
BY MARK B. SOLOMON, EXECUTIVE EDITOR – NEWS
LOGISTICS NETWORK DESIGN
Organized fo
UNLIKE OTHER SEGMENTS OF THE LOGISTICS FIELD,
warehousing has avoided the dreaded fate of “disruption”
from newfangled business models. Since people began
erecting physical structures to store stuff, capacity has been
leased under multiyear contracts with fixed rates, terms,
and conditions negotiated up front. Long-term deals foster
security, stability, and strong customer-provider relationships, the maxim has held.
While long-term deals aren’t going away, there may be
room for an alternative approach. And it has come from a
Seattle-based startup called Flexe Inc. Founded in August
2013, Flexe has created a spot market for warehouse space
in an effort to exploit inefficiencies in a static environment.
Flexe’s platform matches companies with excess space or
periodic vacancies with those who need space quickly, usually for a short time period, but who don’t want or need the
obligations of a long-term lease.
Today, the Flexe marketplace consists of more than
85 warehouses in 20 cities in the U.S. and Canada. The
company doesn’t operate any warehouses, and there are
no leases involved; each facility is operated by the business
with the available space. Flexe markets and advertises the
space, defines the scope of each party’s responsibilities and
liability through a uniform contract patterned after stan-
dards developed by the International Warehouse Logistics
Association (IWLA), and deploys cloud-based software
that manages delivery scheduling, inventory tracking, and
billing, among other tasks. A prospective user can name
its price for the specific services it wants to take advantage
of. The provider’s proposal, once submitted, is non-nego-
tiable. The user pays Flexe, which then cuts a check to the
provider minus its commission.
Flexe’s customers include third-party logistics service
providers (3PLs), manufacturers, retailers, and wholesalers, all of which could be on either end of the transaction
depending on the circumstances. What they have in common is that they work with a flexible and scalable model
that, until now, has been largely alien to warehousing. The
typical duration of a transaction on Flexe’s platform is four
to six months.
FOR WINE TOOLS FIRM, ROOM TO BREATHE
One of those customers is True Fabrications, a 12-year-old
Seattle-based manufacturer and wholesaler of wine gifts
and accessories, which has been with Flexe for about two
years. Dhruv Agarwal, True Fabrications’ co-founder and
strategicinsight
Need DC space for a seasonal surge
or a quick-hit market opportunity?
Flexe may have a deal for you.
Warehouse space,
by the drink
