How Omni-Channel Retailing Has Spurred On-Demand Warehousing
The warehousing and logistics industry in the United Kingdom continues to face challenges from the ever-evolving retail sector.
Recently, omni-channel retailing has seen a dramatic rise. Omni-channel retail is the business practice of using both online and offline platforms to sell to consumers. Though it maximises sales and caters to a wider audience, it increases the strain on storage spaces and existing infrastructure.
Warehouse Space Is Running Out in the UK
In their annual report titled “Industrial and Logistics Market”, the United Kingdom Warehousing Association (UKWA) and Savills reported that there are over 1,500 individual warehouse units in the UK that each provide more than 100,000 sq ft of space. This means less than 424m sq ft of warehouse space is being used for storage.
Peter Ward, UKWA CEO, stated: “Policy makers must not overlook a fundamental factor for UK logistics to continue to thrive and to feed and clothe our people: the warehouse itself.”
A research report by property consultancy Lambert Smith Hampton pointed out that due to omni-channel retailing the demand for warehouse space will soon exceed supply. By 2020, warehousing requirements will exceed current available space by 25 million sq ft.
“E-commerce in the UK is not just growing rapidly, but it’s also evolving as retailers attempt to satisfy consumer demand ever more quickly and efficiently,” said Steve Williams, national head of Industrial and Logistics at Lambert Smith Hampton. “This is resulting in unprecedented demand for strategically located logistics warehouse space across many parts of the country.
“Whilst we’ve seen new warehouses being developed over the past couple of years, the amount of new space being planned simply can’t keep pace with the demands of internet retailers and their distributors.”
It is clear that the construction industry will be working in overdrive to meet this demand in the upcoming years.
Smart Warehousing Solutions Are Needed
Technological advancements will have a huge role to play in transforming the warehousing and logistics sector.
As omni-channel retail grows, vendors—both traditional and e-commerce— need to significantly alter their storage and distribution systems. There will be a great deal of disruption in the industry brought on by increasing digitisation.
More consumers will shop online using their smart phones and ordering at variable times of the day. Not just consumers, but businesses will also order items in bulk. Retailers will need to make sure they have flexible space available for their fast-changing inventories.
It is no longer feasible to have extra space in warehouses. There is already a rising trend in renting warehouse space, which will further expand to renting and leasing warehouses as per demand.
Omni-channel retailers need to adjust inventory as per seasonal demands. On-demand warehousing thus offers them a cost-effective and flexible storage solution.
LogistCompare offers both retailers and warehouse providers a convenient solution. Omni-channel retailers can use the marketplace to gain instant access to warehouse providers putting up their space for rent. With LogistCompare’s smart warehousing solutions, both parties can enter into short-term or long-term agreements as per their requirements.