A recent analysis by commercial real estate and investment firm CBRE Group, Inc. revealed retail-to-warehouse conversions are soaring, in large part due to the way people shop. Big box stores are becoming less lucrative while e-commerce is booming. As this trend continues, Cleveland 3PL service providers at On Time Delivery & Warehouse urge companies to recognize there is a big difference between companies that solely provide public warehouse space and the extensive services you get with a third-party logistics firm.
The retail-to-warehouse place-trading involves a broad range of projects, including demolition of old malls and remodeling warehouse retail stores into distribution centers. CBRE also found that while demand for warehouse space overshot supply last year by nearly 30 million square feet. Industrial real estate availability fell to its lowest level since 2000, with only 7 percent up for grabs. Retail space, on the other hand, is much more prevalent. However, just because the space is there doesn’t mean it’s primed and move-in ready. Issues have included trouble with rezoning (which requires local government buy-in) and difficulty convincing other stakeholders like co-tenants to go along.
Companies in Cleveland looking to expand or outsource some of their warehousing services must understand that while public warehouse space-only services do offer some benefits, they’re far less than what you get teaming with Cleveland 3PL service providers.
As long-time Cleveland 3PL providers, the On Time Delivery & Warehouse team is trained to quickly spot any hint of a supply chain weakness so we can either address it fast or – better yet – avoid it altogether. That keeps our partners from losing profits, customers and investor faith.
A single supply chain weakness has the potential to stymie productivity, spike company costs and hamper a business’s ability to deliver quality.
In recent years, there have been numerous instances wherein a supply chain weakness forced a business to close its doors – temporarily or permanently – or curtailed its ability to offer key products. Worse, those failures made big headlines.
Perhaps the most significant moment in any supply chain is the one in which the goods reach their final destination. Cleveland last-mile delivery services providers know creation of a stellar product isn’t going to mean much if the correct one doesn’t make it – on time and intact – to the customer. On Time Delivery & Warehouse is one of the most trusted names in Cleveland last-mile delivery service precisely because we’ve made this such a top priority. It’s literally part of our corporate identity, and we use the latest technology in order to ensure last mile delivery services in Northeast Ohio that meet or exceed the expectations of your customers.
One of the reasons we’ve been able to serve this need so well amid the constant, frenetic pace of e-commerce growth is that in addition to our expansive networks for shipping, freight, trucking and warehousing, we’re also centrally-located for many supply chains near a Midwest urban center.
A recent report issued by industrial researchers in Chicago noted that while there is rarely a one-size-fits-all approach to urban warehousing in logistics, companies are increasingly relying on third-party firms that already have an integrated network of functional last-mile delivery centers, boots-on-the ground services and practical knowledge of issues likely to arise. Our understanding of the unique challenges and opportunities within this Northeast Ohio community uniquely positions us as a dedicated 3PL, poised to carve out competitive advantages for our Cleveland last-mile delivery services customers.
As long-time Ohio 3PL supply chain managers, On Time Delivery & Warehouse is in the business of helping clients navigate everything from minor quirks of tricky logistics to major, unexpected supply disruptions and market changes. The U.S. federal shutdown that began Dec. 21st has the potential to threaten supply chains – in the U.S. and globally – on several fronts as the political gridlock drags on, especially if both sides dig in their heels for weeks or months, as the president has said might happen.
If you think government employees and a few federal contractors are the only ones impacted by a government shutdown – think again. Federal motor carriers, freight shipping carriers and agricultural suppliers are just a few examples of entities our Ohio 3PL supply chain managers know can be squeezed when official stalemates stretch on. Sparring and posturing in D.C. and between U.S. and international leadership are often regrettable but inevitable realities. Resolution of those issues is slightly above our pay grade, but what our Ohio 3PL providers can do is help our clients be prepared as possible.
We may not know when this government shutdown will end or if/when there will be another. We do know these issues have a way of cropping up again and again. When they do, we’ll be ready. We have a long list of contingency plans that include alternative suppliers, routes, transport methods and storage facility options that we can deploy at a moment’s notice. This helps our clients keep their goods and services moving and minimize losses, even if they can’t be avoided altogether.
Cleveland warehousing, distribution and fulfillment centers are grappling with a worsening labor shortage, some struggling to meet rising demands fueled in significant part by e-commerce. Nationally, it’s been a challenge that has businesses looking to launch or expand warehousing operations considering not just large consumer concentrations but an ample supply of qualified workers as well.
CBRE, a commercial real estate and research firm, released recent analysis revealing the need nationally for an additional 226,000 warehouse workers this year and the same in 2019. That’s a 25 percent spike in the five-year annual average. Low unemployment is complicating matters. A smaller labor pool is smaller means higher wages.
Companies shopping Cleveland warehousing options soon learn this is a dynamic but mature market. Often, costs are more manageable when they team with an established Northeast Ohio third-party logistics firm.
Sustainability has become a hot topic in Northeast Ohio supply chain management circles, especially as scientific projections on impacts of climate change become increasingly urgent. As long-time Cleveland 3PL providers integral to Midwest supply chains, On Time Delivery & Warehouse managers know there is much evidence to support the assertion that companies committed to greener, more sustainable supply chains help guard against numerous financial, reputational and legal supply chain risks.
A recent HSBC Navigator survey found that of 8,500 business leaders in 34 markets globally, one-third are making sustainability-related changes to their chain of supply in the next three years – specifically prioritizing more environmentally-friendly practices. This is better for the planet obviously, but that’s not the only reason. Our Cleveland 3PL supply chain experts have long known these benefits go both ways. Economic drivers for greener supply chains, according to the HSBC survey, include:
- Greater cost efficiency
- Improved revenues
- Better overall financial performance
If you’re in the market for Cleveland warehouse space, a bit of insider advice from third-party logistics experts: Start your search early. Lock in the deal as soon as possible.
Recently, The Wall Street Journal reported warehouse space leasing has become increasingly rivalrous as online sales impose evermore unforgiving time crunches on already-squeezed U.S. and Ohio warehouse and distribution centers. Just in the 2018 third quarter, real estate brokerage firm CBREGroup calculated a sharp drop-off in the industrial warehouse vacancies – even though nearly 50 million spare feed of new warehousing capacity hit the market during those three months. The upshot is that as distribution demands rise, Cleveland warehouse space is snapped up almost as fast as it’s built.
On the one hand, this is good news because it’s a signal of a robust economy for consumers. However, that’s only part of the story. Bigger picture, it’s the exponential growth of e-commerce and corresponding shift in infrastructure. To further break it down, shoppers turning to the internet for everything from loaves of bread to love seats, many third-party logistics companies and their warehouses are hurdling toward or hovering at capacity.
Warehousing is critical because client confidence can be bolstered or broken based on satisfaction with the good condition and timely delivery of products. Cleveland warehouse space shortages can lead to supply chain bottlenecks that can ding consumer satisfaction.
Cleveland 3PL supply chain management teams recognize the additional cost for many businesses amid the U.S.-China trade war is potentially crippling, involving $250 billion in Chinese export tariffs and $110 billion on U.S. goods. The Section 301 remedy tariffs have been unrolled in phases this year, and more are scheduled for next year. The Section 232 tariffs on aluminum and steel have also hurt bottom lines globally.
Hopes are high an accord will soon be reached, but in the meantime, firms and industries reliant on Chinese manufacturing and parts (and there are many) should be mapping their game plans if they haven’t already. The aide of an experienced 3PL supply chain management company can help businesses navigate these challenges and curtail impact.
Whether the tariffs will have the desired economic policy impact remains to be seen, but it’s not impossible that even if this one ends, a new one won’t suddenly crop up. Tariffs are one of those adverse market forces outside our control for which companies need to prepare because of the dizzying blow to American manufacturers and shippers, jobs and consumer prices. As a long-time Cleveland 3PL supply chain management partner, On Time Delivery & Warehouse works to formulate strategic supply chain approaches – tailored to each client – to help minimize distribution and financial woes.
Shipping companies around the globe are increasingly concluding that outsourcing with a third-party logistics service isn’t simply a means to ease the workload or save costs. Shippers of all sizes are finding such partnerships essential to carving a competitive advantage in modern markets. A solid partnership with a trusted Ohio 3PL can mean the difference between sink-or-swim for some shippers.
Consider recent analysis from supply chain think-tank Armstrong & Associates (published in Supply Chain Management Review) revealing that 9 out of 10 Fortune 500 companies depend on third-party logistics for key supply chain services. We’re guessing most folks reading here aren’t on that list, but the reason we make note this statistic is because these firms have the means financially to construct strong internal logistics operations – yet each concluded if they want to enhance client satisfaction in an era when same-day service is expected, it’s not worth the investment to optimize logistics on their own. Reality is, their resources and energy are better spent on innovation. They decided the smartest thing they can do is team up with an experienced 3PL team with the ability to act as a positive business extension.
Shipping companies especially can’t overlook at least exploring Ohio 3PL partnerships because of high truck driver turn over and soaring rates of trucking shipments and expenditures are higher than ever – and continuing to climb. This ongoing trend is squeezing all shippers, but smaller ones in particular. They need the savings 3PLs can provide, and are actively seeking freight broker services to secure better rates.
Warehousing bottlenecks are a source of time-consuming and costly delays that ultimately chip away at customer confidence. A once-in-a-while warehouse bottleneck might be manageable, but even an occasional bottleneck can signal larger, non-obvious systemic issues that are hurting your bottom line. If this or constant in-house warehousing bottleneck headaches sound familiar, it’s time to discuss these concerns with an knowledgeable Cleveland 3PL provider.
Outsourcing warehousing services to a third-party logistics firm is sometimes the smartest way to manage complex and/ or fluctuating operations long-term – and avoid warehousing bottlenecks.