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THE CHANGING FACE OF INDUSTRIAL: HOW THE LOGISTICS MARKET IS BEING IMPACTED BY ECOMMERCE AND OTHER TRENDS
Land & Development Conference 2016
THE CHANGING FACE OF INDUSTRIAL: HOW THE LOGISTICS MARKET IS BEING - - PowerPoint PPT Presentation
THE CHANGING FACE OF INDUSTRIAL: HOW THE LOGISTICS MARKET IS BEING - - PowerPoint PPT Presentation
Land & Development Conference 2016 THE CHANGING FACE OF INDUSTRIAL: HOW THE LOGISTICS MARKET IS BEING IMPACTED BY ECOMMERCE AND OTHER TRENDS Clicks to Bricks Recent Store Closings / Restructuring Expanding Online Retailers Expanding Large
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Recent Store Closings / Restructuring
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Expanding Online Retailers
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Expanding Large Format Retailers
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The Supply Chain Model
First Mile Distribution Hub Last Mile
- Mega DC
- Connecting sea ports to intermodal hubs
- Sears Canada Vaughan DC
- Cross-docks
- 150,000 – 250,000 SF
- Costco Brampton DC
- Urban warehouse fulfillment centres
- Close to roof tops
- To support swift response times – same
day delivery
- Walmart Etobicoke DC
E-Commerce
- Growth in e-commerce sales is 5x greater than traditional retail
- On-line buying visits grow 10x more than brick and mortar locations
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E-commerce Influencers
“Get Local”
1. Click to Doorbell: Instant gratification 2. Speed of Delivery: Delivery expectations 1. Fast for 2013 was 4 days 2. Fast for 2014 was 3 days 3. Fast for 2015 was 2 days 4. Fast for 2016 is next day 5. Expectation 2017 is same day 3. Always Open: Shop when/where you want
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E-commerce Impacts
1. Individual retailers cannot match Amazon’s “Get Local” capability 2. Less square footage of retail space and more square footage of logistics space 3. Substantial increase in e-commerce fulfillment centres in large cities 4. Substantial increase in the e-commerce click/collect in small cities/rural 5. Increase in need for reverse logistics
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Real Estate Challenges Business Concerns
Changing Existing Building Operations
Portions of warehouse converted to e-commerce fulfillment
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Real Estate Challenges Business Concerns
Speculative Development Trends & Concerns
Adaptability of site designs
- Site Coverage - high requirement
for trailer parking, and employee parking impacting site density
- Power Requirements – Energy
intensive pick & pack operations, conveyers will require large power
- Building Design – Decrease in
truck level doors and increase in van level doors
Oxford Airport Business Park, Calgary
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Industrial Market Sector Disruptors
- Who is going to come out ahead?
- What do you see as threats to the market?
- Where will new development be located?
- Will occupiers pay more for space that truly fits their needs?
Same Day Delivery Internalizing Supply Chain
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