26.4.2022 | Industry matters

Uniserve talks warehousing

 

The race for space as demand outstrips supply.

The importance of warehousing capacity to the optimal operation of global supply chains has never been more in evidence than it is right now. For years, the UK’s logistics professionals have had to work around the challenges created by the nation’s chronic under-supply of warehousing space. More recently, however, this lack of supply has started to be addressed in a big way. According to the Office for National Statistics, 2021 was a record year for new warehouse projects – with the East of England being one of the particular growth hotspots (including Uniserve’s own 750,000 sq. ft Felixstowe Mega DC).

Actually, you don’t really need the ONS’s report to see evidence of this trend first-hand. Any driver traversing East Anglia’s main routes over the last 12-18 months will have noticed the array of new warehousing developments springing up in Suffolk, Essex and Norfolk. Even though our region exists outside of the UK’s traditional ‘golden triangle’, the warehousing market here is red hot. So, beyond recognition of historic supply shortages, what has changed?

At its simplest level, more warehousing is being built because demand for space continues to grow exponentially. There are multiple factors driving this phenomenon. High on this list is the impact upon global supply chains inflicted by the overlapping arrivals of Brexit and the COVID-19 pandemic. The resultant delays and disruptions to the free flow of goods between international markets have forced businesses around the world to reconsider their inventory controls and distribution patterns. The introduction of a ‘just in case’ approach to complement or replace ‘just in time’ methodologies have become more commonplace. Here businesses offset the impact of further supply disruptions to core markets by ensuring the availability of contingency stock at a local level. Across multiple industries, offsetting the possibility of shortages means greater reliance on warehouse storage. Achieving these goals requires greater levels of storage space.

The extraordinary growth in e-commerce has also fuelled the insatiable demand for warehousing space, with online retailers and 3PLs utilising DCs as key nodes in their (or their customers’) distribution networks. Even before the pandemic hit, the online market was exploding in terms of size and importance to the UK economy. Since the first lockdown, however, the nation’s appetite for buying online and home deliveries has found a different gear altogether. As an indication of this, a report commissioned by the UK Warehousing Association (UKWA) showed that between 2015-2021 warehouse occupancy by online retailers increased by 614%. What’s more, with the increased range and sophistication of ‘final mile’ solutions for e-commerce providers, warehouses in our region can now compete on an even playing field with traditionally located inland facilities.

What with being home to the UK’s largest container port, two major ferry ports, as well as a number of smaller short-sea terminals, a larger warehousing footprint in East Anglia has actually always made sense due to the sheer throughput of cargo. After all, port-centric warehousing offers unique customer benefits, including:

• Reduced costs and complexity
• Quicker access to goods
• Improved cashflow
• Reduced upstream resource burden
However, it just makes even more sense now due to the massive infrastructure and regeneration projects across our region. From the East Coast green energy cluster and Sizewell ‘C’ to the Freeport East initiative, we’re likely to see huge inward investment and stimulated business growth and, naturally enough, a lot more warehousing for the foreseeable future.

Uniserve operates warehousing facilities across the UK, Europe and the Far East. Primary locations in the UK include Felixstowe, Tilbury, Northampton, South Kirkby, Chepstow, Heathrow and Manchester.

Uniserve is proud to sponsor Felixstowe Rotary Club’s Charity Boxing Event.