Case studiesAugust 12, 2015
True Fabrications Saves $170k in Storage Costs vs. a Sublease
True Fabrications, a Seattle based wholesaler of wine accessories, was managing a major growth spurt. New orders exceeded projections and they didn’t have capacity in their existing warehouse to accommodate the influx of inventory. To get through their Q4 holiday peak, they estimated a need for 2,000 to 3,000 pallet positions of capacity for about 4-5 months. Additionally, they wanted to maintain direct control of their goods in order to ensure high quality service levels to their customers. With a history of strong growth, the company had faced this challenge before. They evaluated several options, including:
- Taking on a short-term lease
- Finding "dead storage" with a nearby 3PL, and
- Creating "on-demand" capacity with FLEXE
All of the 3PL providers came back with high quotes for bulk storage, preferring instead to utilize their space for more lucrative, full-service pick and pack clients. The available subleases on the market all had longer durations than needed to get through True’s inventory peak. Additionally, a sublease would require substantial upfront costs for the lease, broker fees and operational setup costs, not to mention the ongoing fixed monthly fees for the lease and triple nets. True decided to go with FLEXE, which provided:
- Secure pallet storage at less than $5/pallet/month
- Immediate availability, with no startup costs at all
- Direct control of their inventory through FLEXE's online software platform
- No fixed fees and no time commitments
True Fabrications saved approximately $170,000 vs. a 9 month sublease, their next-best option – a difference of 67%.
Furthermore, with the ease of operations enabled by the FLEXE platform, True is now using the solution in an ongoing way as a “virtual warehouse,” which extends the capacity of their primary facility without incurring additional lease obligations.
With FLEXE, True has reduced overall costs in their supply chain, turned fixed costs into variable costs, and maintained high service levels for their clients.