Is Flexible Warehousing on the Rise?
Warehousing is the foundation of the supply chain, and with the current coronavirus pandemic ripping through the economy as well as the planet, that supply chain has been well and truly disrupted. Companies have had to adapt to a new way of working and many are looking for a more ‘flexible’ logistics solution, starting with warehousing.
The answer to many companies’ nightmares has been to use the concept of utilising a third party’s warehousing facilities ‘on demand’; flexible warehousing. This gives them the option to pay for required storage capacity only when it is needed. Services can range from spare space in an area of a warehouse, to a fully serviced solution, including transport and logistics.
The average length of an industrial warehousing lease is around 7 years, so flexible warehousing is a lifeline to many companies, particularly through uncertain times such as these. This of course can cut out the middleman with supply to the consumer being transported direct from the third party warehouse. As many companies are reluctant to invest long term in warehousing facilities, flexibility is key.
During the pandemic, online retailing has skyrocketed. This has exacerbated the need for more urban storage solutions, closer to urban locations. Many different sectors are in direct competition for land nearer to large cities, so countryside storage seems to be the way forward, at least for the time being.
Temporary or flexible solutions are not altogether a new concept; with the rise of flash sales, and in particular, Black Friday deals, retailers have found new ways to cope with storage of fast moving stock. If they were to utilise their own spaces, they would be left with empty shelves for a lot of the year, and only at full capacity during peak sale periods. This is obviously a false economy, and the reason flexible warehousing is becoming a more attractive proposition.
For new businesses unable to predict their sales, and more established firms wishing to expand, this seems like the ideal short term solution. And as warehouse space is advertised more frequently online, the growth in demand and awareness is rapid. Flexible warehousing could be set to be the norm in the months and years ahead.
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