Warehouses are often treated as fixed parts of the supply chain. They are designed, expanded and optimised as though the requirement for space simply exists. But a warehouse is really the physical consequence of something happening elsewhere.
Supply and demand rarely align perfectly. Customers want different quantities, at different times and in different locations from those in which products are manufactured or supplied. Inventory exists to bridge those gaps, and warehouses exist to hold that inventory while it waits.
The greater the mismatch, the greater the requirement for stock, storage space, handling and infrastructure.
Poor forecasting, long or variable lead times, large order quantities, supplier constraints, network design and inventory policies can all increase the amount of stock flowing through a warehouse. Improving those upstream decisions can sometimes reduce the requirement for capacity more effectively than optimising the building itself.
Of course, warehouses will always have an important role in balancing supply and demand. The point is not that warehouses are unnecessary. It is that the requirement for warehouse space is partly determined by decisions made across the wider supply chain.
Sometimes the best warehouse strategy starts outside the warehouse.