I'm not sure if it's the next logical step in the whole cloud-computing concept or a crazy mis-application of digital concepts in a physical world, but it so happens that Amazon offers a "Warehouse as a Service" service in addition to it's popular S3 and EC2 web-based services. You store your products in their warehouses, they handle your order-fulfillment processes through their existing processing chain.

It's called Fulfillment by Amazon and it turns out that it's not new; I just happened to hear of it for the first time when they spit out a press release advertising new abilities to integrate order-fulfillment processes with your existing website or sales processes. The logic behind it is simple and similar to that behind the Amazon Web Services: the company already has the capacity and scaling ability to handle this sort of thing, and with the efficiencies born of those factors it can offer third parties the use of those capabilities cheaply or for free. For FBA, you simply have to be registered as an Amazon Pro Merchant and pay less than $.50 per month per square foot for inventory actually stored. With the new web-based fulfillment APIs, however, you don't actually have to use their storefront, and you completely determine your stocking levels.

Interesting stuff. Warehouse space has always been available for rent, and I am sure there are some large companies which have always outsourced their fulfillment processes, but having it available on this scale is new and different and opens up a vast range of possibility for businesses which had few options beyond building in-house previously.