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With the continuing advance of online shopping, agility is increasingly important in the retail landscape. Innovations such as virtual AR stores and drone delivery have improved retailers’ ability to respond to fluctuations in demand, pricing and customer expectations. However, with everything from groceries to bespoke clothing now ordered online, it has been more difficult to inject agility into warehousing. Finding space and negotiating leases is time consuming. Furthermore, being tied into a long lease may prevent retailers from innovating with new products, or to quickly scale up or down. Now, British start-up Stowga has come up with an answer, by developing warehousing as a service.

Stowga takes advantage of the fact that many retailers have warehouse space they are not using, while others need space but don’t have the resources or ability to sign a long lease. Stowga works to match a retailer’s demands to available spare space. The entire process is completely flexible – retailers can choose the size, location and duration which best suits their needs. Payment is on a ‘pay as you go’ basis. Stowga can also help retailers access other warehousing services. This includes the movement of inventory, which can also be scaled up or down as needed.

The on-demand approach pioneered by Stowga allows retailers to access new warehouse space quickly – locating and moving in as little as one week. According to Stowga, this will not only improve agility, but will also help to keep warehousing costs proportional to sales. This flexibility could then allow retailers to more easily trial new products or markets. Retailers can rent a small warehouse for a month or two and try out their product with minimal up-front investment. Will turning warehousing into a service transform retail economics? What other areas of the retail supply chain could be transformed by using a service model?