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2024 Update Coming Soon Published: April 2023 Number Of Pages: 84
Warehouses act as a strategic decoupling point in the supply chain, they enable companies to match customer demand and Supply when they are not in synchronization. With the supply disruption of consumer goods, medicines, and food products due to the coronavirus pandemic warehouses came under a lot of pressure for order fulfillment.
Cloud-based systems are more scalable and flexible than a site-based WMS, hence, reconfiguring to match a company’s changing size, complexity, and market conditions is easier and less costly. Costs can be further reduced in some cases by choosing a software-as-a-service (SaaS) subscription rather than paying for software licenses.
RaaS allows one to use mobile robots without buying them. One could think of it as robot rental, but you only pay when the robots are in action. Your subscription package can be tailored to include the mobile robots’ implementation, programming, control, maintenance, and all other services requiring specialist engineers.
Blockchain tech is a network that uses cryptography to create data transfers in blocks on a shared digital ledger. Blockchain has implications for warehouse operations & inventory management because of its advanced data authentication, validation, and transparency. Blockchain databases could enable every stakeholder in complex supply chains to connect & share automated records for every transaction within the secure network.
Smart warehouses gather huge amounts of data, via scanning of goods and through the use of sensors on their materials handling and other equipment. Analytics systems can detect patterns in your data that would otherwise be invisible. Another application is in monitoring the condition of your equipment and assessing the best approach to its maintenance. This minimizes downtime, reduces repair bills, and extends asset life.
This trend became popular due to Amazon. From unloading and racking to selecting and packaging, every part of an automated warehouse is designed for efficiency, which means you can deliver goods from your warehouse to your customer’s doorstep faster than ever before.
Distribution Centers (DCs) are an increasingly integral part of the U.S. economy. As retail evolves from traditional brick-and-mortar stores to include more selling through e-commerce channels, the significance of these technologically advanced engines of commerce will continue to rise. A distribution center connects the local economy directly to an immense global stream of commerce. On average, a new DC employing 3,000 workers resulted in 5,111 total new jobs in an MSA including those 3,000 at the new DC, and sustained those new jobs over 20 years.
Retail giant Lowe’s Canada plans to operate a new 1.23 million-square-foot distribution center just outside of Calgary as part of its strategy to optimize its distribution network to better meet the needs and expectations of its in-store and online customers. The new distribution center is a partnership with the Highfield Investment Group and will cost more than $120 million. Walmart Canada has officially opened a brand new, state-of-the-art warehouse order fulfillment system at a distribution center in Cornwall, Ontario – the first of its kind at Walmart Canada. This $20-million investment will improve Walmart Canada’s world-class supply chain.
The acceleration of electronic commerce has demanded new spaces to streamline the distribution of products and supplies in cities, in Mexico. In this sense, the logistics and real estate sectors occupy a relevant position. Accounting for nearly one-fifth of the country’s GDP and population, Mexico City and its metropolitan area rather than the whole of Mexico seems to be the most promising market that possesses the appropriate purchasing power. As a business-friendly city, Guadalajara is also dubbed the “Silicon Valley” and “fashion capital” of Mexico, in addition to traditional sectors such as agroindustry, processed food, and furniture.
The warehousing market can be segmented into the following categories
With ongoing pressure to improve the agility of the supply chains company owned and company operated came under a lot of pressure in the United States many companies are looking to outsource the warehousing activity, this would be a beneficial move from a 3PLs perspective as this would potentially raise the demand for them.
The strained relations between the two largest economies the US and China and the likelihood of this relationship irrespective of who is elected into the office of the US would be a strain on Imports into the US this would be a strain Bonded warehouses, the underutilization of these is likely to increase post-pandemic.
Many 3PL companies like DHL and UPS which are already in the B2B e-commerce segment serving various small businesses now have a huge potential to serve the B2C sector as this segment has seen a huge spike in demand during a pandemic, many of these companies are looking for rapid expansion which would positively impact the US warehousing market.
E-commerce companies would generate a larger share of demand for cold storage and Agri warehouses as the share of commerce through online mode has increased multi-fold during a pandemic, with storage in food products of all the categories fresh, chilled, and frozen categories.
With hyperlocal fulfillment strategies, e-commerce players would generate more demand for smaller distribution centers (repurposing the retail in the city) than for larger ones which generally are located in the suburbs of the city.
This trend can be observed in the commercial construction sector only warehouse construction showed an increase amid the pandemic while retail, hotel, and housing have shown a large drop.
Post-pandemic, we believe the United States might need another 800-900M square feet of space in the next five years to cater to the demand generated by the e-commerce industry.
Sectors like Apparel and footwear, Hotels & restaurants, chemicals, and automotive have taken the biggest hit due to COVID-19 this would be reflected in their respective warehousing markets, whereas Pharmaceuticals and consumer goods have been shielded and the impact has been minimal so logistics partners and warehousing contracts in this specialized sector is likely to increase in the short term.
Many 3PLs have already invested and geared themselves for the COVID-19 vaccine supply chain, as the temperature requirement might be as stringent as -70°C in the entire value chain.
Advancement of digital technologies and advanced analytics across the supply chain is generating a lot of data this is one compelling reason for companies to develop a digital twin, all the warehousing data would be captured and the digital twin can help companies make faster decisions and help in optimizing the processes, Xcelgo is helping many logistics companies build their digital twin and streamline their operations.
5G coupled with edge computing would be the key driver in increasing Automated Guided Vehicles (AGV) proliferation, they can help warehouses automate repetitive tasks, reduce labor costs, and increase workplace safety.
The order picking and put away processes performed by AGVs can be coupled with artificial intelligence to automate the quality inspection process by computer vision (vision quality).
This can help reduce errors and improve the reliability of warehouses, Amazon has already introduced this in the US and many companies like Conveyco are already big-time players in providing these technologies.
The coronavirus pandemic has been a blessing in disguise for warehousing in the United States, with the rise in technology, e-commerce, and 3PLs as the key drivers to propel the demand.
