Changing E-commerce Landscape Transforming the Face of Logistics

Cities around the world are experiencing population booms, and millennial consumer behaviors are putting more pressure than ever on supply chains to deliver goods quickly and efficiently. In fact, research from CBRE shows that millennials in the UK do more than one third of their shopping online (excluding food), and this is expected to rise to half for 50 percent of people in this group by the year 2019. A similar logistics trend is likely to be seen in other countries once their technological development and internet speeds are on par with those found in the UK.

A new report released by CBRE entitled Last Mile / City Logistics Report singles out the sudden rise of e-commerce as the driving force behind the most disruptive movement to ever hit the logistics industry, and there is no denying that it has caused a seismic shift in attitudes toward industrial real estate.

Instant Gratification

Consumers want to have their goods in their hands as quickly as possible. Two-day shipping is no longer enough to satisfy many shoppers; one-hour and one-day delivery services are taking off across the world, and supply chains are scrambling to keep up.

In order to meet this demand for so-called instant delivery services, new last-mile strategies are emerging, such as locker locations and infill service centers. The widespread restructuring of supply chains in Europe has boosted the need for efficiency, which has led to a smaller warehouse network with bigger but fewer facilities. East Asian markets are increasingly making use of vertical logistics facilities to work around the lack of available land in that part of the world. This practice is only likely to grow as more densely populated American and European cities start to see the benefits. Securing the most strategic sites in big cities is also vital.

This blog post was based off of an article from the World Property Journal. View the original here.