June 2017 | Commentary | Checking In

Reconstructing Supply Chains

Tags: Warehousing, Retail, Transportation Infrastructure, Logistics, Real Estate, Supply Chain

Keith Biondo is the publisher of Inbound Logistics magazine.

I see it every day on my way to work, and if you're in logistics, you see it too. The demand chain structure that you manage is breaking down and rebuilding itself, just below the surface, and changing into what best serves consumers' needs.

On a major New York artery, I pass a long-vacant big box office supply store with 8-foot-high letters displaying a name once considered a symbol of retail growth and success. The store is a short drive for about one million consumers, but they are not driving anymore. They demand the product come to them. But today I notice new construction at the site. Does another retail giant plan to revitalize this prime location? No. It's being reformed as a "Prime"-type warehouse to serve the demands of those millions who want what they want to come to them, immediately.

A little farther on my journey into Manhattan, I roll by big, solid buildings that arguably were once the manufacturing capital of New York State in Brooklyn and Queens. Their last hurrah was feeding demand for military supply during World War II. Today, many of these empty and underused buildings are being refurbished into loft-style apartments, featuring hip 12-foot ceilings and retro industrial views from floor-to-ceiling windows. Many new neighbors are springing up around and in between. I spot 40 new sky-scraping apartment buildings, gleaming and glassy, with construction cranes still sitting on top of many.

Each building will house thousands of New York City's growing, young workforce, many of whom want to avoid the traditional way of receiving products to meet their wants and needs. Most don't own cars anyway. They can always call Uber or Lyft, but who wants to lug bags of consumables around the big city when what you need can come to you?

The building planners and managers of these new mini-cities realize they have become the final foot in this new, reconstructed supply chain. Doormen have become foremen, and lobbies have become mini DCs to accommodate the crush of daily deliveries. Some buildings even create secure holding areas near the lobby, where on-site workers help tenants with white-glove setup for larger deliveries.

In industrial New Jersey, many antiquated commercial buildings near large consuming markets are being transformed for the same reason: to become fast, new, small distribution centers serving business and consumer supply chain impatience. Farther away from city centers, some malls are replacing "available" signs with new logistics tenants—space destined to position product closer to consumers. Some are set up for shoppers to pick up, others for fast, final-mile delivery.

See it? New supply chain infrastructure is rebuilding itself, just below the surface. Amazing, isn't it?






Visit Our Sponsors