Is it Time to Sell Your Warehouse?
The e-commerce boom has resulted in an increasing demand for industrial warehouse space. Throughout 2020, the demand is expected to continue to grow as e-commerce, and same-day delivery drives big retailers to invest further in the warehouse industry. Rafael Villamizar from Vertical Strategies Real Estate, considers that “this is the strongest seller’s and landlord’s market…mostly due to the explosive growth of E-Commerce…As a result, sales prices and leasing rates are still on an upward trend breaking ceilings of historical highs. Thus, it is the best time to sell and the most challenging time to be a tenant from a cost perspective”.
Christos Constantinides from CoStar Analytics also observes that “Some of the country’s largest e-commerce retailers are capitalizing on Miami’s extensive international connections, relocating global headquarters and distribution operations in the area…Online sales in the United States rose by close to 15% over the past year. One such example is Amazon, which quadrupled its presence in the Miami industrial market over the past five years.”
With such big players populating the local market, it makes sense to outsource fulfillment to a local company that can give you the edge in the competitive e-commerce market. With fulfillment taken care of, you can sell off your warehouse infrastructure and release capital that can be reinvested into your business. Better yet, with flexible warehouse space, you can take the space you need during your peak season and less during your low season making what once was a fixed cost, a variable expense.
Outsourcing expert Brendan Heegan advises that “Retailers should outsource anything that is not their core competency,” he says. “Their core competency could be designing, sourcing, marketing, and selling of their product(s). Wasting overqualified resources to keep order fulfillment in-house becomes more expensive than outsourcing, in some cases.”
Delegating essential tasks to companies or individuals who are experts in their field is a crucial aspect of driving a business forward. Outsourcing order fulfillment is a perfect example, as they offer benefits such as reduced shipping costs, lower operating costs, and a broader reach to help you grow into new markets. By far, the most significant advantage of working with a 3PL provider is that it allows you to focus all your energy on the critical money-making activities that are going to help your business grow.
The decision to own or rent a warehouse space vs. using a 3PL warehousing and logistics service is a critical decision all companies have to make. In the age of Amazon, the consumers’ definition of fast service is continually evolving, and the expectation of next-day or same-day at low or no cost to the consumer means brands now have no choice but to meet that expectation or risk going under.
This all begs the question, is it time to sell your warehouse and outsource logistics to a local fulfillment company that can offer the service the consumer demands? Meaning you can entirely focus on growing your company sales and investing your money in the right places? The businesses that survive and thrive in the ever-changing and evolving economic market are those that react quickly and take advantage of market trends.
At Ameriworld Fulfillment, we recognize that companies want to meet the expectations of their customers faster and that they would like to do so without the expense of substantial fixed infrastructure costs. As a result, we have created the technology to make on-time shipping an affordable reality for all retail businesses in South Florida and beyond. For more info, watch the video below and visit www.ameriworld.com
