Operations people love to plan things. We are the people with checklists; the ones who ask the salespeople, “Well, how are we going to do this?” In short, we don’t like surprises. But unfortunately, in a start-up environment or any company going through rapid change, there will be surprises and plans will evolve. You see it every day – companies that started selling primarily online are selling to traditional wholesalers, traditional wholesalers are trying to figure out how to sell online. Operations managers know that you will use Plan B if you’re lucky, but more likely you will use Plan C or D.
But in an environment like this, how do you optimize for cost and productivity? The answer is flexibility. In times of uncertainty and change, your initial assumptions will be wrong. And unfortunately, when you are talking about leasing a warehouse or investing in automation or material handling equipment, these decisions cannot be easily reversed.
“Don’t bolt anything down,” a mentor told me when planning a warehousing strategy.
A warehouse lease is multiple years, and the moment you sign, you’ve not only committed to a monthly rent payment; you’ve committed to a sales forecast. Are you certain what sales will look like in 3 – 5 years? What if you got too much space? Not enough? Errors in both ways are expensive lessons.
We started Flowspace as a way to delay these difficult decisions and to give companies flexible warehouse options—pay for what you use on month to month terms. It’s warehousing that can change as your business does.