“What’s Going On with the Warehouse Market?”

Dear El Cardinale’

I understand the warehouse market continues to be strong. I’m assuming it’s because of the massive interest in Amazon deliveries. Is there anything else going on here?

Regards, Keepn’ Truckn’

Dear Trucker,

You are right in that Amazon is seeing crazy interest and demand these days. During the first quarter, Amazon reported a net revenue of $75.452 billion up 26.4% from $59.7 billion during the first three months of 2019. North American sales rose from 28.8% to $46.127 billion from $35.812 billion.

But it’s not just demand for Amazon deliveries from consumers staying home that is fueling the warehouse market. What’s also happening is companies are rethinking their supply chains. In short, the entire manufacturing industry is having to adopt a new approach to how they handle their inventory and supply schedules. Third-party logistics providers may be looking to take new space.

And manufacturers are likely to be less accepting of just-in-time delivery in the future. Companies are looking to stress test their supply chains and may look to keep higher inventories on hand so they aren’t caught off guard again should there be future outbreaks.

Are you curious to see my research sources for this piece? Respond back to the message and Ask El Cardinale’.

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