Co-warehousing addresses small warehouse shortage
Tyler Scriven, CEO of Saltbox, on co-warehousing and D2C ecommerce
The real bottleneck is not software, it is the mismatch between how industrial real estate is packaged and what a small ecommerce brand actually needs. A business doing $500,000 to $5 million of sales usually needs a few hundred to a few thousand square feet, daily carrier pickups, and occasional labor, not a full warehouse lease. That gap pushes merchants into bedrooms, self storage units, or rigid 3PL setups that are built for scale, not flexibility.
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Traditional 3PLs are usually large facilities optimized for throughput. Merchants ship inventory into a faraway warehouse, follow strict receiving rules, and give up day to day control. That works for larger volumes, but it is a bad fit for a founder who still wants to touch product, fix issues fast, or run mixed B2B and D2C workflows.
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The shortage is really a shortage of bundled logistics inputs. Small brands do not just need four walls. They need a place carriers will visit every day, packing stations, pallet receiving, trained hourly help, and software to turn custom instructions into repeatable tasks. Leasing a tiny warehouse alone does not solve those problems.
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That is why co warehousing sits between self storage and ShipBob style outsourcing. It gives merchants micro space plus shared labor and fulfillment nearby, while preserving the option to graduate into more outsourced logistics later. The model is less about cheaper rent and more about removing the operational jump from spare bedroom to industrial supply chain.
The next phase of this market is the unbundling of the warehouse lease and the rebundling of logistics as a local service. As more brands expect professional fulfillment earlier in their life, the winners will be operators that can offer small footprints, dense urban proximity, and a smooth path from self operated shipping to fully outsourced fulfillment without forcing merchants to change systems or locations.