Warehousing and Distribution as a Service

I think that the world is ready for — perhaps even eager for — Warehousing and Distribution as a Service (to use the most awkward acronym ever: W/DaaS).  And if it already exists, somebody need to point it out to me.

Warehousing and Distribution is the physical problem of storing and distributing goods.  So if you’re, like, a shoe distributer, you’ve got these shipments of shoes from a manufacturing center coming in, and orders to retailers (or directly to customer or whatever) going out, and you’ve got to keep track of the shoes that you have, know how many you have, and efficiently service your orders going out.  It turns out that this is a non-trivial problem: I used to write software to help out with it.  Which is good as far as it goes, but on some level, software tools can’t help you that much with this physical problem.

Really good, big organizations that can afford to invest in their warehouses have these incredible, efficient, highly mechanized warehouses that allow them to service an incredible volume of incoming shipments and outgoing orders, while retaining accurate inventory count and avoiding breakage.  At the other end of the spectrum, I’ve seen a lot of photos of people like webcomic artists who basically have a pallet of books delivered to their homes, and then sit down with the significant other and start filling out envelopes.  And you may be unshocked to hear that orders may sit for weeks unfulfilled in such a circumstance.

This is ripe for a plug and play “as a Service” situation.  We want something like Heroku.  Customers sign up for accounts with no human contact.  There’s a webpage and an API for alerting them that, “Hey, I’ve got a shipment coming in from so-and-so,” and you upload your skus.  Then when you want send out an order, again there’s a webpage and an API that says, “Grab x quantity of item y and ship it to address z.”  And that’s it.  You never see your warehouse.  It’s like it’s in the cloud.

Managing an efficient warehouse is a difficult and expensive proposition.  A third party warehouse as a service can feed into economies of scale and native expertise that a small operation could never match.  They can also probably broker your rates with Fedex/UPS and get you a much better deal than you could get on your own.

Amazon, which probably has the most amazing W/D system ever created by mankind, is a natural for this business.  Not only do they understand W/D on a level no-one else ever has, they also have quite a lot of expertise with infrastructure as a service, the business model, and pricing through their cloud computing services.  This makes so much sense that I strongly believe that Amazon actually does this already, though I have not been able to find confirmation of this.

In any case:

People who are doing small businesses involving shipping orders: you need this.

Amazon: if you aren’t already offering every part of this, you should.

People who have deep expertise in W/D and also have interest in modern software and/or a friend who can help you co-found: you should figure out if Amazon is already doing this, and, if not, start a company doing this with a business model which ends with “is acquired by Amazon.”

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