Reviewing warehousing industry analysts "top ten trends" lists for 2008 and 2009 reveals that not much has changed in the minds of supply chain services customers over the past years. In many ways, warehousing facilities act as a barometer of broader economic trends. Third-party warehouses experienced some of the first signs of economic weakness as more clients stockpiled inventory. Likewise, warehousing companies benefited from a soft real estate market by negotiating cheaper leases and by purchasing property at low rates. As the industry faces another challenging year, experts indicate that five key trends should remain on the minds of company leaders.
The Return of Regional Warehousing Facilities
Opening up more warehousing facilities to serve the same clients might not seem like an effective approach to "going green." However, the increasing urbanization of the worlds population and an industry still recovering from sudden spikes in energy costs has forced warehousing suppliers to rethink their locations. Staging product in multiple warehouses can reduce reliance on air freight and decrease shipping time. Dedicated warehouses that serve major cities can also respond more efficiently to regional demands.
Consolidation Impacts Warehousing Companies
As credit markets crumbled under the weight of a global recession, many third party logistics companies have resorted to selling off assets or merging with rivals to survive. Though industry analysts maintain that the sector should continue to thrive, successful companies must constantly evaluate their properties and their partnerships.
Distinctions Emerge Between Freight Warehousing and Inventory Storage
As all kinds of companies learn to cope with the rules of running a business in recessionary times, warehousing companies should also adjust to changing client demands. Warehousing facilities that once served as pick-and-pack terminals have been converted to long-term storage for clients that need to stockpile product. Likewise, many warehouse managers have changed floor plans and storage equipment systems to differentiate high-demand products from long-term storage items.
Collaborative Supply Chains Demand Tighter Technology
Shipping services have responded to customer demands for speed and security by integrating tracking services into their information technology infrastructure. Today, clients demand similar tools from warehousing providers, especially for products that must be kitted or assembled before delivery. Successful warehouse services already use database and management tools that can collaborate with shippers and with client ordering systems.
Shrinking Cycles for Warehouse Management Solutions
Decades ago, warehousing company managers often shopped for "best of breed" technology to manage their facilities and to track inventory. Systems were implemented with expectations that they would run effectively for fifteen years or more before requiring upgrades. Today, the constant evolution of technology requires a different approach to purchasing warehouse management solutions. Instead of buying a single system rated "very best," managers are happy to purchase exactly what they need right now to evolve and expand their systems. Interoperability and expansion are the key buzzwords right now, since facility managers must be ready to integrate their systems with clients and with other vendors.
Overall, the trends affecting warehousing services this year stem from end user demands for speed, efficiency, and environmental awareness. As the global economy recovers, industry analysts expect the suppliers who thrive in this environment to dominate their niches during the next financial boom.
Industrial Market Trends
World Trade Magazine