E-Commerce Growth is Boosting Industrial Markets
E-Commerce. Most of us don’t think about it on a regular basis, but it plays a part in our everyday lives and is only getting more prevalent. In fact, the e-commerce market in the United States has grown consistently over the past six years, by double digits, in fact. In 2015 alone, e-commerce here in the U.S. saw a single-year growth of 14.6% (or, $341.7 billion) for the year, according to the U.S. Commerce Department.
When you actually think about e-commerce, giants like Amazon, Target and Wal-Mart may come to mind. In fact, Amazon just recently signed a lease for twenty Boeing 767 freight planes just to go between their distribution centers in an effort to expand its current fleet –due to growing demand.
As Distribution Centers Expand E-Commerce Delivery Services, there is Growth in Demand for Industrial Warehouses
How does this impact our industrial markets? First, consider that U.S. industrial vacancies reached a 15-year low at the end of 2015. As Amazon and other e-commerce companies grow, their need for warehousing and multiple distribution centers grows as well.
Expedited Delivery Services
Even though Amazon has two primary distribution centers in the U.S., they have also been busy setting up urban facilities across the country for “last mile” and same-day delivery. This helps meet customer demand for instant gratification of orders placed online, which is a very fast-growing trend in e-commerce.
When multiple e-commerce websites carry the same products and offer the same level of competitive pricing, how do they now jockey for your business? It’s in the delivery, and yes, the return policies as well.
Efficient Product Returns
Traditional manufacturers have never been equipped in their warehouse space for the constant flow of returns. Amazon and its competitors see high value in offering the service, but need to do so efficiently. The returns themselves require a significant amount of warehouse space, and e-commerce companies are configuring their warehouse spaces and centers for it.
Industrial Facilities for E-Commerce Companies on the Rise
With domestic manufacturing down for its fifth consecutive month as of February 2016, e-commerce companies are keen to take these urban area facilities to meet their growing demands. With the e-commerce logistics market projecting a consistent growth of just under 10% per year through 2020, these industrial spaces that once sat still in the commercial real estate market are being snatched up quicker than you can blink.
There’s no doubt that the world is changing. And, when it comes to e-commerce and its savvy shoppers who know what they want and when they want it, the industrial space in this country has become prime real estate.
If you are an e-commerce organization needing a digital presence or want to improve the one you have, contact us at 720-221-7126 to find out how we can help your business excel.