Executive Briefings

As Online Sales Grow, E-tailers Place Smaller, Distribution Hubs in Urban Areas

E-commerce retailers are starting to add smaller, urban warehouses to their supply chains as the pace of online shopping and delivery transforms distribution demands.

As Online Sales Grow, E-tailers Place Smaller, Distribution Hubs in Urban Areas

In a report to be released next week, analysts with real-estate brokerage firm CBRE Inc. say demand for existing industrial structures under 200,000 square feet and located in the midst of high-population urban zones could soon go up. Companies aren't necessarily turning away from sprawling distribution centers far from urban centers, said David Egan, CBRE's head of U.S. industrial research, but are adding more sites as they roll out speedy and even same-day delivery.

"You need to expand and make your supply chain much more complex if you want to be able to promise and deliver on that same-hour, same-day or overnight delivery everyone is coming to expect," Mr. Egan said.

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In a report to be released next week, analysts with real-estate brokerage firm CBRE Inc. say demand for existing industrial structures under 200,000 square feet and located in the midst of high-population urban zones could soon go up. Companies aren't necessarily turning away from sprawling distribution centers far from urban centers, said David Egan, CBRE's head of U.S. industrial research, but are adding more sites as they roll out speedy and even same-day delivery.

"You need to expand and make your supply chain much more complex if you want to be able to promise and deliver on that same-hour, same-day or overnight delivery everyone is coming to expect," Mr. Egan said.

Read Full Article

As Online Sales Grow, E-tailers Place Smaller, Distribution Hubs in Urban Areas