The demand for industrial real estate in the United States continues to outpace the available supply. While some companies are getting creative by sourcing real estate in secondary markets and using non-traditional options, others may not have the expertise or the resources to implement these alternatives on their own. Recent coronavirus-related issues have further complicated the warehousing and distribution sector as exporters are stuck holding excess inventory and retailers can’t keep hand sanitizer and toilet paper on the shelves.
Navigating this complex environment can be exceedingly difficult without an in-house team of supply chain experts. Many businesses are turning to their third-party logistics (3PL) partners for the skills to navigate what seems like never-ending volatility in their supply chains.
3PLs Mitigate Warehousing Challenges
Many 3PLs specialize in warehousing and distribution as a core competency. When your organization is experiencing space shortages in your warehouses or distribution centers, a 3PL can help by providing:
With technologies and best practices constantly changing in the warehousing sector, it can be difficult for businesses to keep up. 3PLs have experts on staff that many companies will not have in-house. Simply having the right people available to address a problem can make all of the difference in implementing a timely and effective solution. For a 3PL, understanding the latest best practices is their core business. This means they’ll stay up to date on the most effective solutions, both old and new.
Most internal supply chain operations grow as an extension of the business. Unfortunately, this means that processes and practices sometimes don’t keep pace with growth and cause bottlenecks or other inefficiencies. These issues can limit the growth potential of the entire business until they are addressed.
Whatever supply chain challenges a business faces, the 3PL has probably seen it before. They will not only have a variety of tried-and-true solution options to apply to each scenario, they will also possess the capability to tailor these solutions to each unique application. 3PLs can analyze a variety of factors to optimize existing warehousing and distribution space to improve capacity. Some of these factors include:
- Inventory management practices
- Shipping/receiving processes
- Supplier and carrier networks
- Technology and equipment
- Labor management practices
These process improvements not only help to increase capacity in existing spaces, but also typically have a positive impact on the bottom line. In essence, a good 3PL pays for itself.
When process improvements aren’t enough to meet capacity demands, 3PLs that specialize in warehousing often have vast industrial real estate footprints at their disposal. When businesses find themselves in need of larger distribution facilities, new facilities, or multiple facilities in different markets, chances are good that a quality warehousing 3PL can facilitate that expansion, either short-term or long-term.
For example, 3PLs may be able to integrate new customers into existing multi-client facilities. In busy markets, an experienced 3PL might be able to find more non-traditional distribution space that can be renovated to give a client market access, locate an existing facility that’s willing to sell, or incorporate more out-of-the-box solutions such as micro-fulfillment centers in commercial properties. Whatever the capacity challenge is, an experienced warehousing provider should be able to present a timely solution.
Find Capacity With Phoenix Logistics
At Phoenix Logistics, we seek out a variety of real estate opportunities, such as renovating underappreciated or unused commercial and industrial properties for use by our clients. This practice often gains us footholds in markets that other providers struggle to access. We also help our customers optimize transportation and inventory management practices to drive more efficiency in their warehouse and their overall supply chain.