The Big Picture
Warehousing and storage in the United States is currently a $22 billion industry employing over 600,000 people. Add in another $9 billion and 60,000 employees that handle order fulfillment and you’re looking at a major industry.
Almost 10,000 U.S. businesses take part in this industry, organizing and directing the flow of hundred of millions of dollars worth of merchandise a year.
In Q1 2014 alone, desktop eCommerce sales in the U.S. amounted to $56.1 Billion. This figure represents only a small glimpse into the total amount of cargo warehoused and distributed throughout the county, which can be a little overwhelming to think about.
Let’s look at a breakdown of some key statistics that outline the state of affairs as it pertains to warehousing, fulfillment technology, and the distribution of goods across the nation.
Considering the Footprint
There is a phenomenal amount of warehouse space available in this country and that volume just keeps growing. 215 million square feet of industrial space was absorbed nationwide last year, up 27.6% from 2013. More than half of that space–over 16 billion square feet–is found in the Midwest and South.
Vacancy in those warehouses has gone down from 8.83% in 2013 to 7.9% in 2014. As a country, we’re building new space every day, increasing our capacity to store raw materials and goods. As our storage capacity grows, so too does our infrastructure to keep what we store organized.
Organizing the Flow
According to a study by the Georgia Institute of Technology, less than 30% of the warehouses in the U.S. are operating efficiently. The solution to these inefficiencies may lie with the implementation of WMS, or warehouse management systems. These systems are constantly developing and improving the ability to fulfill orders more efficiently.
One major improvement in fulfillment technology has been the implementation of robotics to improve efficiency. Companies like Amazon have been able to deploy these systems to great effect, with over 10,000 units currently in service throughout their warehouses.
According to Janney Capital Markets these robots enable warehouse workers to pick items two or three times faster than before.
On The Road
Once orders are processed and packed at a warehouse location, they move across the country with amazing speed–consumer goods are often available next day in most of the country.
In fact, Amazon’s new same day delivery program has been a resounding success, increasing retail conversions 20 to 25 percent when it’s made available to a consumer at the point of sale.
In 2012, for-hire transportation represented over $450 billion dollars of the U.S. GDP and local freight trucking is predicted to grow to over $28 billion by 2020. This demonstrates the growing health of the country’s distribution network.
Retail distribution centers continue to spring up all around the country, creating greater access to goods, widening the network that connects products to their destinations, and increasing our capacity to efficiently organize the flow of goods across the country.
If you’re a logistics manager and need a partner to help you strategically manage and successfully move your products out of the port and onto their final destination, feel free to reach out to us to discuss your needs.
And for detailed information, maps, and contact information for the ports of Los Angeles and Long Beach, be sure to download a free copy of our Comprehensive Port Service Guide.