By Mr.Anuj Kapur
Across Europe, supply chain disruption is slowly becoming a normalcy for the warehouse and logistics industry. Research shows that the demand for warehouses in key cities such as Berlin remains high, with many organisations expanding their production, storage and distribution capacities. However, the shortage of physical space remains a pressing challenge for the future of the industry.
The shortage has largely been driven by changing e-commerce habits and the intensified demand for just-in time delivery, requiring a quicker turnaround of goods. Enterprise customers who want to be able to operate flexibly to expand their storage space for seasonal stock or operate on a short-term basis have seen this lack of storage space impact their ability to be agile and keep up with market demand. In an industry dominated by long-term leases, dynamic players are struggling to make an in-road as skills and storage space dry up.
To match the expectations of the modern market, warehouse operators and space providers need to be able to offer flexible and scalable storage options to the customers that need it, whether they be in manufacturing, retail or government. It’s often said that ‘pallets move the world’ and for customers to activate both just-in-time and just-in-case delivery, as well as their own business goals, they need a storage solution which reflects that. For this to happen, stakeholders from across the logistics industry must come together to create the warehouse of the future – but what exactly should that look like?
For the warehouse of the future to succeed, it needs to align to the storage needs of the modern economy, and that means improving agility and resilience through flexible storage solutions in a wide range of locations to provide a number of robust supply chain routes to the customer.
Similarly important, technology needs to be leveraged to drive efficiencies, operational agility and robust security systems. Automated solutions such as robotic racking and intelligent forklifts are a key to filling logistics’ critical skills gaps; McKinsey reports that over the next 10 years, 57% of warehouse jobs will be automated in part to deal with this shortage. However, while pursuing automation, the industry must also recognise that it must invest in the people working on the front lines too, in order to retain talent and attract the next generation.
Sustainability is another key aspect of the warehouse of the future, and indeed for the wider planet. Logistics stand in the cross-roads of all businesses, a vital part of their supply chain and a contributor to their overall carbon emissions. By embracing sustainable solutions in how a warehouse is run and built, logistics firms can play a key role in passing on their sustainable credentials to businesses worldwide.
For us, ESG is at the core of our operations, and that’s why we have made the conscious decision to make a significant property portfolio investment, closing old sites and consolidating in carbon negative / neutral storage solutions, to make a step change in reaching our carbon targets. We believe a fundamental approach is needed with significant infrastructure investment made possible by taking a holistic view of business needs, whilst simultaneously freeing up brownfield sites for use by the communities that live in them day in and day out.
To deal with the profound crises shaking the warehouse and logistics industry, stakeholders from across the trade must come together to build the warehouse of the future. By enabling the dynamic customers of today to operate flexibly and ethically through technology and sustainability commitments, we can work to make our industry more agile, more resilient, and more forward facing.
(The author is Mr.Anuj Kapur, Vice President & Head of India Region, Iron Mountain, and the views expressed in this article are his own)
