It should come as no surprise that the U.S. consumer market is the most substantial of any country in the world. Last year alone, our families purchased over $13 trillion in goods and services, with a steep rise in the e-commerce portion of the market. Online sales are projected to continue to rise over the next couple years: gross e-commerce sales in 2018 totaled $505 billion and are expected to grow to an estimated $735 billion by the year 2023.
Most retail brands have embraced this trend while maintaining brick and mortar businesses to meet the demands of the consumers. With the demand of goods comes the demand for the storage space to store them. Just as the e-commerce game is changing, so is the future of warehousing. In the last few years the industrial and warehouse real estate market has exploded to support not only the demand for more space, but also the change with supply chains, distribution, logistics, and location demands. So, what do we see changing to meet the future of warehousing?
A New Blueprint: Growing Up, Not Out
Logistics focus on the efficiency of many processes that happen in your warehouse including, but not limited to, transportation, picking and packing, and distributions of items to ship. It can seem daunting to expand your warehouse space to make things run smoother—not to mention the cost involved in expanding.
With land becoming more expensive and less attainable, one trend of warehouse development is expanding up, rather than out. Known as vertical storage, this concept has an instant impact on your potential for growth. The industry standard for most warehouse heights is 36 feet. If you’re only using the floor space, think of all the vertical storage capacity going to waste. Many warehousing companies are now moving to utilize that space with custom shelving, which not only offers more square footage of storage but simplifies some of the logistics. Instead of having to go to various parts of the warehouse to collect items that are spread out, they can now be grouped above similar items to streamline the speed and efficiency of the picking process to fulfill an order or multiple orders. This idea of vertical warehouse continues to grow as larger companies move towards this style of storage, such as the futuristic fulfillment centers that e-commerce giant Amazon has proposed. As the price of industrial real estate continues to rise, so will the heights of storage centers to counter the cost.
Technology: Work Smarter, Not Harder
Efficiency is the name of the game when it comes to warehousing. It’s also what makes money. Many companies have guarantees in place when it comes to order fulfillment, such as same-day shipping. In order to honor that promise, sophisticated technology solutions are put in place to guarantee speed and efficiency. One of the most cost-effective technologies on the market is known as order fulfillment optimization. These systems are customizable and designed to plan, control, and analyze volumes of orders picked in the warehouse, in turn making is easier for operators to know which products to pick and how many. By operating as a real-time product and order sorting software, these systems keep up with the demand of same-day shipping operations. This essentially automates one of the most time consuming and error-laden warehousing processes, thus becoming more efficient, dependable, and less expensive in the long run.
The rise in using warehouse robotics is also making a dent in labor and operational costs. Demand for high performance, flexibility, accuracy and productivity makes robotics technology more and more beneficial to warehouse facilities. Not only do they reduce the risk of safety incidents, but robotics help manage the movement, storage, and sorting of warehouse inventory. Finally, the evolution of machine-to-machine technology (M2M) is streamlining the process of automating certain aspects of warehouse operations. While many warehouses have this technology already in place, new improvements allow communication with warehouse management systems to help control and monitor equipment that is used in the fulfillment processes. These systems also supply feedback and information that warehouse operators can use to pinpoint logistical improvements.
Urbanization: Location, Location, Location
Going back to the industrial revolution, warehousing began as a sign of urban development. If you walk around any big city today, it is easy enough to identify the older industrial districts by the often abandoned warehouse buildings that loom like architectural monuments of the past. In recent years, however, these old warehouse buildings have become the focus of urban re-development, and not just for the trendy art galleries or expensive downtown lofts some are designated to become. The fast growth of the e-commerce industry has resurrected the need for quick turn-around and delivery of goods, which has returned the old warehouses to their original use: storage and distribution. For most distribution warehousing operations, transportation totals more than half of the company’s overall costs. By default, a location closer to consumers better utilizes its capital and labor management. With its priority location, hiring workers in an urban setting is also an easier market, particularly with municipal government partnerships. Developers become an important economic identity of an industrial neighborhood, often creating a job market in a part of the city that often faces job-loss with the fall of industrial industries. Many companies considering an urban location have an opportunity to receive tax credits, government loans, and grants solely based off the location. Urban space is also becoming more in-demand and costly, as well as having some functional challenges due to old design with existing warehouses. But, as we mentioned above, whether you’re starting from scratch with a new building, or modifying an old warehouse—which can be challenging but cost-effective—the future is looking up, quite literally. Vertical storage will continue to evolve and will likely help shape the technology trends of future warehousing and distribution facilities.
Rowe Transfer: Moving American Industry Since 1883
The manufacturing industry is experiencing a long-awaited comeback in the United States, and storage space is becoming increasingly more in demand. At Rowe Transfer, we have all of your warehousing needs covered! With a state of the art 50,000 sq. foot facility located in Knoxville, TN, you can store whatever you may need with us. For over 130 years and counting, Rowe Transfer has been committed to providing our clients with professional and custom crating, rigging, warehousing, and transportation services and solutions across numerous industries and a variety of projects. Whether your needs are large or small, close to home or across the world, we can store anything your business may need, whether temporarily or long-term. Our warehouse is climate-controlled to ensure that your products remain in an ideal climate to prevent potential damage. We also specifically build warehouse racks to suit your storage needs, while utilizing warehouse space. Rowe Transfer employs updated technology including inventory tracking software and offer a 24-hour security monitoring system to give you added safety and peace of mind. Interested in learning more about what we have to offer, or need a custom quote for your project? Give us a call at 865-523-0421, or contact us online to get started discovering which Rowe solution is right for you!