Navigating What’s Left of the Industrial Real Estate Market

Are you in touch with what is happening in the industrial real estate market?  A shortage exists everywhere, creating real challenges for businesses seeking to expand in their marketplace. For example, Napa Valley's industrial warehouse vacancies are now at 1.3 percent. The thriving wine industry finds its growth and margins constrained due to a lack of space to store inventory, and higher freight costs to store it farther away. In 2017, commercial properties in most markets enjoyed the sustained growth of demand, high occupancy rates, and rising rents. This is under added pressure in 2018 due to rising interest rates and increased U.S. manufacturing activity encouraged by recent tax reforms.  U.S. industrial rents now average $5.53 per square foot with a year-over-year increase of 5.3 percent. Many tenants are in the difficult situation where expiring long-term leases are 30-50% below today’s market rates.  For example, if you have been leasing space for the past ten years at a $4.50 sq. ft. rate and the owner comes to you this year to let you know the rate is increasing to $6.50 per sq. ft., your options are to absorb this cost, buy the building or vacate. Do you have an immediate plan in place to address the options you’ve been given?  As top logistics markets continue to operate at a sub–3.5 percent vacancy rate, you can expect continued competition for quality warehouse and distribution space to add pressure on rents through 2018.  First Quarter 2018 warehousing vacancy by US Region - Source: U.S. Real Estate News: U.S. warehouse and distribution rents rise as vacancy rates dip.  Read More

Topics: Industrial Real Estate Market, Supply Chain Strategy

Executing Your 2018 Supply Chain Strategy

With an upswing view of the reignited economy and the growing demand for diverse products, your supply chain network—manufacturing plants, warehouses and distribution centers—face challenges like never before. In light of increasing freight costs, global complexities, more demanding customer service requirements, new e-commerce challenges and risk management considerations, it has never been more important to navigate and execute supply chain strategy/operations. Today's complex global business environment - with its rapidly advancing technologies, emerging world markets, and vastly extended supply chains, places increasingly critical decision-making demands on logistics professionals. In a world expanding global, the challenges of providing seamless supply chain solutions across geographical and cultural boundaries have continued to mount. Those who invest in Lean Supply Chain Management can improve a company's competitiveness and overall profitability by identifying warehousing, transportation and trade compliance, while at the same time eliminating waste and non-value added activities.  Given that as much as 80% of the operating costs are in logistics—freight, labor and inventory—it is critical to have a better understanding of your supply chain strategy. It seems the 2018 theme is to continue building a supply chain network, working together to drive collaboration and reduce inefficiencies. It's important that both manufacturers and importers discuss better ways of communicating and sharing information with their partner retailers and distributors to help improve the customer experience.   Many companies have expressed interest in exploring different ways of  servicing the customer, looking to become agiler by stepping out of their comfort zone—those even recently investing in their own manufacturing facilities, allowing them to be more flexible in their strategic decisions. Food & beverage manufacturers are examining the possibilities of setting up one or more distribution centers for limited shelf life items, which will allow them to provide better service to their customer base and help reduce overall transportation costs. As new regulations hit the transportation industry, a common topic of discussion is how to better navigate the new Supply Chain landscape to continue to service customers more effectively; while proactive shippers continue to search for viable 3PL warehouse distribution centers to allocate inventory in markets closer to their customers, in an overall effort to mitigate delays.  Read More

Topics: Rise of 3PL Fulfillment Services

Self-Driving Trucks-The Emerging Trend

We've seen a lot of futuristic self-driving cars and trucks on the big screen, but none of them really resemble the autonomous (self-driving) killer tractor trailers from the movie Logan. The scenes with the autonomous trucks are short but gripping. They feature a number of menacing, cabless trucks racing down the highways without any care for the human race caught in their path. It’s a scary vision of the future and needs to earn the public's trust. Imagine if you will…a situation where a truck driver must choose to avoid a vehicle in the road, hit a pedestrian, or direct the truck off the road into a barrier. In each situation, someone will get hurt. If we rely on automation to make these decisions, it must be programmed to make the right or split-second decision. Even if the system is programmed “morally,” it will make human error life-and-death decisions. In these types of situations:  Who is liable…The programmers? The truck manufacturer? The trucking company? How will insurance companies adapt to the traffic accident model?  Read More

Topics: Future of Logistics, Driverless Trucks

The Rise of 3PL Fulfillment Services

Any growing business must inevitably evaluate its fulfillment process from time to time. Beyond fulfillment, many companies that want to scale growth or transform themselves to compete in the world of manufacturing and e-commerce, typically turn to a 3PL provider. The reasons behind this are simply because most small or midsize companies don’t have the resources or what it takes for successful supply chain redeployment – such as the in-house experience, WMS (Warehouse Management Software), or seasoned labor support to effectively make it happen. Third-party logistics providers typically have a network of operations including warehouses, mobile handling equipment, a truck fleet, and experienced warehouse forklift operators and pickers/packers.   Read More

Topics: Rise of 3PL Fulfillment Services

So You've Outgrown Your Warehouse...A Sign of Growth or Mismanagement?

Remember your first brand new car?  What a well-oiled machine it was?   Read More

Topics: Outgrown Your Warehouse

All Roads Lead to Toledo, Ohio

When Spartan Logistics began to build a presence in Northwest Ohio in 1990, we quickly realized the untapped potential for warehouse and fulfillment services for our customers. From a single location, we expanded to a footprint of over 1.4 million square feet of warehouse storage and distribution. Our approach to 3PL is highly personalized. No task is too large, no detail too small, no storage and handling project too complicated.  Spartan’s Northwest Ohio DCs and warehouses are often in proximity to major transport routes and terminals. For global manufacturers and suppliers looking to accelerate performance in today’s competitive marketplace, all roads lead to Toledo, Ohio. Although Toledo has a "rust belt" automotive reputation because of its manufacturing history, companies continue to move everything from raw materials to finished products to and from Toledo.  If you haven’t had the pleasure—a day spent in the warehouse district is a day well spent. There’s renovation and resurgence going on in Toledo’s Warehouse District—It’s growing in leaps and bounds with great entertainment, restaurants, shopping and nightlife. It’s the new urban playground of what was once known as “Glass City”.    Read More

Topics: Toledo Ohio, 3PLs in Toledo Ohio, Warehouses in Toledo Ohio

Disruptive Innovation in Logistics

The Ohio State University hosted a discussion of Disruptive Innovation in Logistics at the Harvard Business School of Columbus in Columbus, OH.  Spartan Logistics President, Steve Harmon, was asked to give a presentation to an audience, piggy- backing the discussion.  Steve's presentation —Big Data in Logistics, focused on how big data is revolutionizing many fields of business, and logistics analytics is one of them. The complex and dynamic nature of logistics, along with the reliance on many moving parts that can create bottlenecks at any point in the supply chain, make logistics a perfect case for big data. In case you are not familiar with the term…Big Data- It is essentially the ability to mine billions of data points to make better predictive decisions.  Logistics- especially the 3 V’s of Velocity, Volume, and Variety has always been reliant on forecasts; if there is one thing we know about predictions about the future it is that they are always wrong.  Supply chains have always been dependent on measuring statistics, point of sale data, and quantifiable performance indicators.  Big Data is something else- it is driving the car more effectively with a better roadmap, rather than just a rear-view mirror.   Read More

Before you Commit to a 3PL Provider, Ask These 5 Questions

Manufacturers and retailers used to value 3PLs for their physical assets. The very idea of outsourcing transportation and logistics functions evolved as all the elements of the supply chain became part of a single management perspective.  Thirty years ago, pricing was king, contracts were short, and performance was measured in three-year bids. That has all changed. It seems like only yesterday when "3PL" was just a new acronym thrown about at industry conferences and logistics trade magazines to describe a different kind of transportation and warehousing company. Today, Spartan Logistics is appreciated more for our cerebral approach and adaptability to define your strategic direction and execute it.  Let’s say you are the owner of, or you are responsible for, a company that sells or distributes footwear to a segment of the population. Before commiting, ask these five questions of a 3PL provider:    Read More

Topics: Common 3pl Questions

Interning at the Family Owned Logistics Business

I have heard about the family logistics business for as long as I can remember.  I've heard my parents and grandparents come home and talk about the latest successes or failures of the company. I never really understood what they were discussing and wasn't always interested at such a young age.  All I cared about was sports and being outside with friends. My Summer Internship:  My name is Nick Harmon and I will be a sophmore, majoring in Business at Mount Vernon Nazerene University in Mount Vernon, OH. This summer I was given the opportunity to intern at my family's business—Spartan Logistics in Columbus, OH.  They are a  third-party logistics (3PL) logistics company, family owned and operated since 1988.  They've grown from a small, regional public warehouse and distribution provider, to a logistics company with 13 strategically placed locations throughout North America.      Typical Responsibilities on the Job: Over the summer, I was tasked with working on financial projection spreadsheet projects, assisting in marketing functions, and also hands-on experience in the warehouse.  I accompanied my Grandfather on business trips and meetings. All of these opportunities have truly changed the way I view the business and the business world. It has made me appreciate how important the family business is to so many people, and has helped me gain insight into what a successful business should look like.    Read More

Topics: Logistics Internship

Take the Necessary Steps to Recover from a Major Customer Loss.

  Losing a key client can be devastating for any business.  This devastation is not limited to just financial loss or tarnished company brand.  There is the declining employee morale associated with the loss as well. No business has a perfect record when it comes to retention.  Even your best customers will eventually move on at some point, and not necessarily because of your lack of performance on your end.  When you come to terms with this reality, you'll be prepared for when it happens.  I've personally worked with entrepreneurs who have experienced loss at all levels. But the one thing that stings these solitary geniuses the most is losing one of their biggest clients.   Take the necessary steps to recover from a major customer loss so you're positioned to recover quickly: Be flexible with your staffing.  Creating the right types of efficiencies will ensure that your company isn't overstaffed, even on your biggest accounts.  Even if employees are dedicated to certain accounts, make sure that you have a plan for migrating your people to other areas of the company should you lose that client.  Laying people off and then hiring more resources again creates a highly volatile environment.  Read More

Topics: Customer Service Lessons