In Focus: Last-Mile Distribution Drives Industrial Demand in Secondary Markets
Friday, August 02, 2019
Retailers are rethinking their supply chain management and locating closer to the end customer to meet their lightning-fast delivery expectations.
Today’s consumers make more purchases online than ever before, and popular merchandise is no longer only small household items and clothing. E-commerce has evolved to include big purchases like furniture, refrigerators, mattresses, and even cars. The challenge is that consumers, accustomed to lightning-fast delivery, still expect to receive these bulkier items in one or two days. To meet those expectations, retailers are rethinking their supply chain management and locating closer to the end customer, which is driving industrial demand in secondary markets that may have taken a back burner to the country’s dense urban metros.
For example, major consumer product retailers like furniture distribution companies have historically served Texas from Houston and the Dallas-Fort Worth metroplex. However, to meet delivery expectations for customers in Central Texas, they now need a significant presence in Austin or San Antonio, and in some cases both. In Austin, almost all the bulk warehouse inventory supports e-commerce deliveries to the immediate area, rather than being shipped to other metros. Most recently, two major furniture groups — Wayfair and Four Hands — took 80 percent of the leased space at Southpark Commerce Center V, choosing the 350,000-square-foot center to support their Austin customer base.