On-demand Warehousing Market Size and Share
Market Overview
| Study Period | 2019 - 2030 |
|---|---|
| Market Size (2025) | USD 16.93 Billion |
| Market Size (2030) | USD 34.94 Billion |
| Growth Rate (2025 - 2030) | 15.90% CAGR |
| Fastest Growing Market | Asia Pacific |
| Largest Market | North America |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order Image © Mordor Intelligence. Reuse requires attribution under CC BY 4.0. |
|
On-demand Warehousing Market Analysis by Mordor Intelligence
The On-demand Warehousing Market size is estimated at USD 16.93 billion in 2025 and is expected to reach USD 34.94 billion by 2030, at a CAGR of 15.90% during the forecast period (2025-2030). A steady pivot toward flexible, pay-as-you-go storage underpins this expansion, as retailers seek inventory proximity without the burden of long leases. Same-day and next-day delivery promises, the surge of dark-store micro-fulfillment nodes, and corporate real-estate divestitures continue to stimulate demand for distributed capacity. Platforms that digitally match excess space with short-term users now sit at the center of omnichannel fulfillment strategies, while value-added services such as kitting and reverse-logistics processing deepen relationships between warehouse operators and e-commerce brands. Competitive intensity is rising as traditional 3PLs retrofit networks to compete with asset-light marketplaces, leaving technology enablement and vertical expertise as primary differentiators.
Key Report Takeaways
- By service type, warehousing and storage led with 54.45% revenue share in 2024; value-added services are forecast to expand at an 18.11% CAGR through 2030.
- By storage duration, under-1-month contracts commanded 52.30% of the on-demand warehousing market share in 2024 and are advancing at a 16.60% CAGR to 2030.
- By warehouse size, facilities below 50,000 square feet represented the fastest segment with a 16.71% CAGR between 2025 and 2030, while units above 200,000 square feet retained 44.18% of the on-demand warehousing market size in 2024.
- By industry vertical, healthcare and pharmaceuticals are progressing at a 19.36% CAGR, outpacing e-commerce and retail’s 37.52% base-year share.
- By geography, North America accounted for 35.17% of the on-demand warehousing market in 2024; Asia-Pacific is poised for the fastest 17.88% CAGR through 2030.
Global On-demand Warehousing Market Trends and Insights
Drivers Impact Analysis
| Driver | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| E-commerce order-volume volatility | +4.2% | Global with concentration in North America & Asia-Pacific | Short term (≤ 2 years) |
| Same-day / next-day delivery expectations | +3.8% | Urban markets globally, strongest in North America & Europe | Medium term (2-4 years) |
| Flexible capacity needs of 3PLs & retailers | +3.1% | Global, particularly North America & Asia-Pacific | Medium term (2-4 years) |
| Blockchain-enabled warehouse marketplaces | +1.9% | North America & Europe early adoption, Asia-Pacific following | Long term (≥ 4 years) |
| Growth of dark-store micro-fulfillment | +2.3% | Urban centers globally, led by Asia-Pacific & Europe | Short term (≤ 2 years) |
| Corporate real-estate divestitures | +2.8% | North America & Europe primarily | Short term (≤ 2 years) |
| Source: Mordor Intelligence | |||
E-commerce Order-Volume Volatility
Fluctuating digital-commerce demand has shattered fixed-capacity planning, pushing brands toward inventory strategies that flex in real time. More than 80% of online retailers posted sales growth in 2024, yet reported sharper daily order swings that demanded nationwide inventory pooling. To keep pace, operators deploy AI-driven forecasting and distributed stock placement, as illustrated when ShipBob moved 10 million units through predictive inventory programs in 2023[1]ShipBob, “Inventory Placement Program Moves 10 Million Units,” shipbob.com. Dynamic capacity absorbs seasonal spikes without permanent overhead, enabling balanced working-capital and service-level objectives. The resulting agility cements on-demand warehousing market relevance for both start-ups and global brands.
Same-day / Next-day Delivery Expectations
Consumer patience now spans hours, not days, forcing retailers to embed stock within metropolitan rings. Urban zero-emission mandates beginning in 2025 add routing complexity that favors micro-fulfillment hubs at city edges. Amazon’s Project Juniper and Ola Electric’s portable dark stores exemplify distributed concepts slated for broad rollout in 2025. These nodes accelerate click-to-door speed while containing last-mile costs, propelling the on-demand warehousing market as an indispensable link between online carts and doorsteps.
Flexible Capacity Needs of 3PLs & Retailers
Third-party logistics firms now underpin 30% of the United States bulk leasing, translating demand vagaries into modular warehousing contracts. Asset-light brands shift fixed property off balance sheets while maintaining control through variable-term service-level agreements[2]U.S. Bureau of Labor Statistics, “Employment Situation July 2025—Transportation and Warehousing Highlights,” bls.gov. In parallel, omnichannel retailers layering stores, marketplaces, and direct websites need storage that scales across channels. This evolution cements the on-demand warehousing industry as a strategic shock absorber for fulfillment networks.
Growth of Dark-Store Micro-fulfillment Networks
Urban dark stores combine automation and proximity, processing hundreds of orders hourly inside footprints under 10,000 square feet. Plug-and-play systems such as Pio cut picking labor by 80% and provide 99.9% accuracy. Tempered multi-temperature grids from AutoStore extend capabilities to chilled goods. These innovations channel more inventory into the on-demand warehousing market by fragmenting national stock into city-sized parcels.
Restraints Impact Analysis
| Restraint | (~) % Impact on CAGR Forecast | Geographic Relevance | Impact Timeline |
|---|---|---|---|
| Urban warehouse space shortages | -2.1% | Global urban centers, acute in North America & Europe | Medium term (2-4 years) |
| Zoning & permitting complexities | -1.8% | North America & Europe primarily, emerging in Asia-Pacific | Long term (≥ 4 years) |
| Cybersecurity risks in shared WMS | -1.2% | Global, particularly developed markets with high digitization | Medium term (2-4 years) |
| Integration issues with heterogeneous WMS | -0.9% | Global, affecting enterprises with complex IT landscapes | Long term (≥ 4 years) |
| Source: Mordor Intelligence | |||
Urban Warehouse Space Shortages
Vacancy for sub-100,000 square-foot urban sheds sank to 3.9% in 2025, half the broader industrial rate. Limited infill land, elevated costs, and community pushbacks throttle new supply, nudging rents upward and crimping expansion. Developers respond with vertical warehouses and adaptive-reuse conversions, yet zoning headwinds persist. These shortages temper the on-demand warehousing market trajectory, especially for last-mile micro-fulfillment models that require dense city footprints.
Zoning & Permitting Complexities
California’s Assembly Bill 98, effective in 2026, enforces buffer zones and green-building mandates on warehouses exceeding 250,000 square feet[3]California Legislature, “Assembly Bill 98 (2024-2025 Session) Logistics Facilities—Environmental Compliance,” legislature.ca.gov. Similar emission-based rules in Southern California levy USD 1,000 per compliance point. Ontario’s 2025 building code introduces racking design upgrades. Such layers of regulation extend timelines, inflate costs, and steer developers toward friendlier jurisdictions. Consequently, regional disparities may curb the on-demand warehousing industry's growth in heavily regulated metros.
Segment Analysis
By Service Type: Value-Added Services Drive Growth
Warehousing and storage held the largest 54.45% slice of the on-demand warehousing market share in 2024, underlining the enduring need for scalable pallet and bin slots. Value-added services, however, are stretching the on-demand warehousing market size fastest with an 18.11% CAGR through 2030 as brands pursue differentiated unboxing and efficient returns. Global Warehouse Solutions recently doubled its Miami kitting space to capture this surge. Providers now bundle assembly, custom packaging, and quality inspection, allowing sellers to outsource complexity while focusing on sales channels.
Distribution and fulfillment services occupy the middle but remain critical, linking inbound storage to outbound carriers. Reverse-logistics sophistication is escalating because online return rates exceed 20% for many categories. Flexible operators equipped with automated sortation and dynamic disposition rules can recover value and reduce landfill. As e-commerce matures, service breadth—not just square footage—will dictate provider selection and reinforce the on-demand warehousing market trajectory.
Note: Segment shares of all individual segments available upon report purchase
By Storage Duration: Short-term Flexibility Dominates
Contracts under 1 month commanded 52.30% of 2024 revenue, spotlighting the preference for rapid inventory turns and low holding costs. Short commitments mesh with flash sales, influencer campaigns, and seasonal surges, while AI visibility tools from firms like Kardex synchronize replenishment. Medium-range 1-to-6-month options still appeal to holiday build-ups, whereas long-term stowage mainly serves slow-moving SKUs.
Shrinking demand-planning cycles make over-stocking risky, so brands lean on real-time dashboards that adjust stocking positions daily. Such orchestration reduces capital trapped in inventory and energizes the on-demand warehousing market’s elasticity. Enterprises blending centralized hubs with forward-deployed nodes need a menu of duration choices, ensuring wallet share spreads across contract lengths.
By Warehouse Size: Small Facilities Capture Urban Demand
Warehouses above 200,000 square feet preserved 44.18% of the on-demand warehousing market size in 2024, capitalizing on scale and automation. Yet facilities below 50,000 square feet post the quickest 16.71% CAGR as congested cities demand proximate pick-up points. Chicago’s multilevel 1.2 million-square-foot vertical center illustrates creative solutions where land is scarce. Nevertheless, vacancy for small sheds sits near record lows, signaling opportunity for operators nurturing micro-fulfillment networks.
Medium facilities (50–200,000 square feet) straddle cost and reach, often forming regional spokes feeding urban satellites. As omni-inventory strategies mature, portfolio optimization will juggle large, mechanized hubs for inbound bulk with dense clusters of mini-sites, collectively propelling the on-demand warehousing market forward.
Note: Segment shares of all individual segments available upon report purchase
By Industry Vertical: Healthcare Leads Specialized Growth
E-commerce and retail absorbed 37.52% of 2024 revenue, but healthcare’s 19.36% CAGR through 2030 makes it the standout. Cold-chain requirements, stringent audits, and personalized therapies necessitate GDP-certified sites and end-to-end traceability. DHL earmarked USD 2.33 billion (EUR 2 billion) to reinforce pharma hubs by 2030. UPS bolstered European capabilities by acquiring Frigo-Trans and BPL. The pharmaceutical cold-chain segment alone is forecast to nearly double in value by 2035.
Food and beverage, consumer packaged goods, and industrial manufacturing retain material shares but grow more slowly as automation and IoT consolidate volumes into fewer high-throughput nodes. Specialized handling—whether temperature, hazardous, or oversized—remains a ticket to margin resilience amid commoditizing ambient storage.
Geography Analysis
North America held 35.17% of the on-demand warehousing market in 2024, underpinned by sophisticated carrier networks, unified commerce penetration, and over 700 operator sites aggregated on Flexe’s platform. Yet, tightening regulations, including California’s proximity limits under AB 98, may relocate future projects to the Sun Belt or the Midwest. Corporate sale-leaseback momentum, exemplified by AT&T, continues to inject stock into marketplace pools, boosting supply depth. Automation spend is rebounding toward pallet handling and crane-based high-bay systems as reshoring revives domestic production.
Asia-Pacific posts the swiftest 17.88% CAGR on the back of India’s warehousing build-out to 300 million square feet and China’s logistics modernization push. Investment of USD 2.5 billion flowed into the region’s industrial assets in 2024, signaling confidence in demand durability. Leasing, rather than greenfield construction, allows quicker market entry and aligns with variable volume growth.
Europe, South America, and the Middle East & Africa trail but deliver selective opportunities. MercadoLibre’s USD 2.5 billion spend enlarges Mexico’s fulfillment grid beyond 100 centers. DP World funnels USD 3 billion into African ports and USD 2.5 billion into Middle-East logistics beginning in 2025. However, fragmented regulations, infrastructure gaps, and currency volatility challenge scale-up speed. Nearshoring to Latin America and North Africa, plus AI-driven route optimization, helps mitigate some constraints.
Competitive Landscape
Technology-enabled marketplaces such as Flexe, Flowspace, and Stord headline a moderately fragmented field, linking real-time inventory demand to spare cubic capacity. Traditional 3PL heavyweights—DHL, UPS, GXO, and Kenco—are re-architecting networks to embed on-demand modules, blurring lines between asset-heavy and asset-light models. Barriers to digital entry remain low, yet operational depth, compliance certifications, and geographic breadth separate leaders from new entrants.
M&A activity centers on capability extension and footprint density. Stord’s May 2025 acquisition of Ware2Go injected 2.5 million square feet across 21 sites, elevating its challenge to Amazon’s FBA. Kenco’s purchase of Drexel Industries’ 3PL arm added four Canadian facilities and packaging skills. Consolidation among midsize operators, such as SalSon’s seven-firm roll-up into a 3 million-square-foot entity, underlines a race to nationwide scale.
Emerging disruptors harness AI and robotics to shrink labor dependence. Cube AI’s USD 2.5 million seed round targets automating 70% of 3PL administrative tasks. Plug-and-play warehouse kits lower capex hurdles for micro-fulfillment newcomers. In this landscape, specialization, particularly in healthcare logistics, offers margin insulation while broader platforms battle for general merchandise volumes.
On-demand Warehousing Industry Leaders
-
Flexe
-
Flowspace
-
Stord
-
ShipBob
-
Cubyn
- *Disclaimer: Major Players sorted in no particular order
Recent Industry Developments
- May 2025: UPS sold Ware2Go to Stord, adding 21 fulfillment centers and 2.5 million square feet to Stord’s network.
- May 2025: Kenco acquired the 3PL arm of Drexel Industries, securing four Ontario warehouses and expanding its footprint to 43 million square feet.
- April 2025: ShipBob partnered with Temu to streamline the United States marketplace logistics for merchants.
- April 2025: DHL Group committed USD 2.16 billion to life-sciences logistics, establishing GDP-certified pharma hubs and enlarging cold-chain capacity.
Global On-demand Warehousing Market Report Scope
| Warehousing and Storage |
| Distribution and Fulfilment |
| Value-added Services (kitting, returns) |
| Short-term (Less than 1 month) |
| Medium-term (1-6 months) |
| Long-term (More than 6 months) |
| Small (less than 50 k sq ft) |
| Medium (50-200 k sq ft) |
| Large (greater than 200 k sq ft) |
| E-commerce and Retail |
| Consumer Packaged Goods |
| Food and Beverage (incl. Cold-chain) |
| Healthcare and Pharma |
| Industrial and Manufacturing |
| Others |
| North America | United States |
| Canada | |
| Mexico | |
| South America | Brazil |
| Peru | |
| Chile | |
| Argentina | |
| Rest of South America | |
| Asia-Pacific | India |
| China | |
| Japan | |
| Australia | |
| South Korea | |
| Southeast Asia (Singapore, Malaysia, Thailand, Indonesia, Vietnam, and Philippines) | |
| Rest of Asia-Pacific | |
| Europe | United Kingdom |
| Germany | |
| France | |
| Spain | |
| Italy | |
| BENELUX (Belgium, Netherlands, and Luxembourg) | |
| NORDICS (Denmark, Finland, Iceland, Norway, and Sweden) | |
| Rest of Europe | |
| Middle East and Africa | United Arab Emirates |
| Saudi Arabia | |
| South Africa | |
| Nigeria | |
| Rest of Middle East and Africa |
| By Service Type | Warehousing and Storage | |
| Distribution and Fulfilment | ||
| Value-added Services (kitting, returns) | ||
| By Storage Duration | Short-term (Less than 1 month) | |
| Medium-term (1-6 months) | ||
| Long-term (More than 6 months) | ||
| By Warehouse Size | Small (less than 50 k sq ft) | |
| Medium (50-200 k sq ft) | ||
| Large (greater than 200 k sq ft) | ||
| By Industry Vertical | E-commerce and Retail | |
| Consumer Packaged Goods | ||
| Food and Beverage (incl. Cold-chain) | ||
| Healthcare and Pharma | ||
| Industrial and Manufacturing | ||
| Others | ||
| By Geography | North America | United States |
| Canada | ||
| Mexico | ||
| South America | Brazil | |
| Peru | ||
| Chile | ||
| Argentina | ||
| Rest of South America | ||
| Asia-Pacific | India | |
| China | ||
| Japan | ||
| Australia | ||
| South Korea | ||
| Southeast Asia (Singapore, Malaysia, Thailand, Indonesia, Vietnam, and Philippines) | ||
| Rest of Asia-Pacific | ||
| Europe | United Kingdom | |
| Germany | ||
| France | ||
| Spain | ||
| Italy | ||
| BENELUX (Belgium, Netherlands, and Luxembourg) | ||
| NORDICS (Denmark, Finland, Iceland, Norway, and Sweden) | ||
| Rest of Europe | ||
| Middle East and Africa | United Arab Emirates | |
| Saudi Arabia | ||
| South Africa | ||
| Nigeria | ||
| Rest of Middle East and Africa | ||
Key Questions Answered in the Report
What is the projected value of the on-demand warehousing market in 2030?
The sector is forecast to reach USD 34.94 billion by 2030 based on a 15.59% CAGR.
Which region is expected to grow fastest through 2030?
Asia Pacific leads with a 17.88% CAGR, powered by India’s warehouse boom and China’s logistics upgrades.
Why are value-added services gaining traction?
Kitting, returns handling, and custom packaging help brands enhance customer experience, supporting an 18.11% CAGR for value-added services.
How does short-term storage benefit e-commerce sellers?
Under-1-month contracts align with volatile demand and minimize capital tied up in inventory, capturing 52.30% of 2024 revenue.
What drives healthcare’s rise in on-demand warehousing?
Strict cold-chain rules and personalized medicine demand temperature-controlled, GDP-certified space, fueling a 19.36% CAGR in the vertical.
Page last updated on:
