Driving through an industrial estate twenty or thirty years ago, you’d have been greeted by an area mostly occupied by local manufacturing businesses, the odd IT company or office, and some factory stores and outlets. Today, chances are that you’ll be met by an abundance of distribution sites, warehouses and ecommerce depots.
The industrial heartlands of the Midlands are a prime example of this transformation. Once a proud manufacturing region and the home of many British brands, the factories and industrial estates of yesterday have been given a new identity. The landscape has changed, and by far the most common use of industrial estate space today is warehousing, coining the nickname; “The Golden Logistics Triangle.” 1
Of course, it makes sense - its central location makes it ideal for rapidly sending onwards goods around the country, and the area is also local to East Midlands Airport - the UK’s biggest freight-only cargo airport. This transformation has come about, not only because of the decline of the UK manufacturing industry, but also as a result of the move towards e-commerce and integrated retailing and the fundamental, lasting changes to how we, as consumers, now live and shop.
The changing use of industrial spaces isn’t just seen in the Midlands - the majority of the warehousing and logistics industry is spread throughout the entire north of the country, including warehousing giants such as Amazon, who are building new, sustainable distribution centres with net zero energy goals in areas such as Tilbury and Dunfermline.
This is a positive change, bringing jobs (as many as 3.2 million) and new industries to the north of the country, fuelling an increase in valuable employment and driving a boom in the logistics sector. New orders for the building of warehouses were worth £5.6bn in 2021, the highest figure since 1985. 2
From the high street, to online marketplace
It’s not just the online giants and supermarkets who are expanding their warehousing needs. Many high street brand names, such as B&Q, M&S and Superdrug already have, or are in the process of creating online marketplaces, 3 where customers can buy not just own label brands, but purchase from other manufacturers too. For example, M&S not only sell their own brand clothes through their website, but also have a comprehensive range of third-party fashion from retailers such as Jaeger, Sosandar and more available to buy online that are either delivered to customer’s homes or to their local store for collection. This not only gives their customers greater choice, but can increase footfall in stores when people collect in person.
Smaller and larger retailers alike are moving from selling purely via physical stores, to developing experiential brands that are sold in-store, online and through social media. Shopify calls this trend ‘omnichannel commerce’4. A recent Shopify report suggests that as many as 53% of brands are investing in tools that allow them to sell anywhere, including through social media and online communities. 5
This transformation in how people want to shop and the technology that is being created to power it is also being driven by ever-changing regulatory restraints - new data privacy regulations and the death of third-party cookies are making personalised shopping more challenging, but at the same time, this bespoke, personal experience is becoming more important to customers. There is a greater need for marketers to develop brand personas that align with consumers values and identities, then ensure that they deliver against those brand values throughout every part of the sales process – from a harmonious online and instore experience, through to fast shipping, seamless returns and transparent data collection and remarketing. People expect to be able to know whether the item they want is in stock online or instore, when they can expect to receive it, and pay for items online or instore too, fuelling a need for ever more complex inventory management, POS and traceable logistics services.
Warehousing needs to do more
All these changes are putting pressure on retailers to ensure that their warehousing facilities are designed, built and configured in a way that supports a greater business efficiency – capable of managing orders from multiple sources quickly; whether it’s delivering to physical stores, customer homes or their workplaces.
Warehousing logistics are becoming an ever-greater science, with racks, storage, stock labelling and picking and packing processes continuing to be refined and becoming ever more sophisticated.
At a time when warehousing space is at a premium, making use of every bit of it as efficiently as possible not only helps to maximise reliability and profitability, but plays a vital role in ensuring the customer’s perception of your brand aligns with their ever-evolving needs and expectations – that they get what they want, when they want it, from where they want it and in a way that keeps them engaged and returning.