London – Kyiv, 20 July 2015 – Innovation in the industrial and logistics sector is overwhelmingly driven by the desire to improve customer service as the rise of e-commerce forces occupiers to optimise their network and property requirements.
At CBRE’s Power of Three conference, 50% of delegates stated that e-commerce will have the greatest impact on logistics occupier decisions in the next three years. The need for manufacturers, retailers and third-party logistics providers to satisfy customer requirements through a greater speed to market is the main stimulus for innovation. As online shopping grows in popularity, delivery times become more important as consumers expect their goods delivered within a couple of days. Industrial occupiers must optimise their network with the latest technology and ensure the location of their hubs balance the need for a large consolidated centre out of town and smaller hubs to serve urban areas and ‘last mile’ logistics quickly.
Industrial occupiers need to balance the need for large-scale, bespoke hubs and smaller-scale urban parcel facilities. As technology advances and the needs of customers change, occupiers move away from owning property portfolios, with 96% of respondents indicating a preference for leasing. Particularly for the smaller hubs in urban areas, flexibility in location allows occupiers to react to changes in the sector and in consumers’ needs.
Amaury Gariel, Managing Director, Industrial and Logistics, EMEA commented:
“It is vital for logistics occupiers to integrate location choice and property selection within the wider context of supply chain reconfiguration. As technology continues to drive changes in the way consumers shop and manufacturers produce, it is vital that occupiers and developers adapt. The locations and role of distribution facilities and the trade-off between labour and occupancy costs against transport times and cost need to be carefully considered. As these are resolved we expect to see shortages of stock around some large cities and major logistics hubs.”
