E-retailing boom is increasing demand for 21st century warehousing20th November 2012

Radical changes in how we shop has already impacted on our malls and High Streets but it is also poised to have an impact on the warehouse sector across the West, according to Tim Davies from Colliers International.

Tim, who heads up the Bristol office, pinpointed growing demand for advanced logistics support by the major e-retailers including John Lewis and Amazon.

 “E-retailing is big business and it is putting demand back into the market. If Bristol and the West is going to meet these challenges we need modern warehousing and more particularly new premises which have been configured for the unique demands associated with e-retailing.”

Tim was commenting on the latest report from Colliers International business trend analysts entitled E-shaping of the European Logistics Market, which predicts the growing demands of e-retailing across the continent must have a knock-on effect, radically re-shaping the commercial property market in the UK.

“The UK alongside Germany and France is one of the three main markets where E-retailing is booming and it comes as so no surprise to see the large concentration of warehouse space occupied by both traditional retailers selling online and ‘pure play’ online retailers.”

E-retailing is based on a ‘Business to Consumer’ (B2C) model which means that at least one, if not several, intermediaries have been eliminated from the supply chain.
The report forecasts that demand from existing online retailers who will continually expand their warehouse space in the coming years, while new market players will be searching for suitable facilities.

“This will result in increasing demand for appropriate distribution space - exactly what the market is lacking at present. Firms on the lookout for tailored logistics services will put pressure on developers to look once again at speculative projects, particularly around our main transport hubs such as the M4/M5 interchange and North Bristol fringe.

Tim said: “The number of people shopping online now is rising and we have already seen the impact this is having on our High Streets. But even traditional bricks and mortar retailers such as Tesco and M&S are rebalancing their selling strategies and focussing on new sales channels.

“This is driving demand for more warehouse space capable of efficiently handling changing logistical requirements.

“Developers who are able to react and adapt their accommodation offering will be very much in demand especially here in the South West where the shortage of new space is becoming a major drag on the anticipated recovery.”