Switching warehouse provider – the whichwarehouse lowdown

This has only recently become a topic of consideration for UK warehouse users and it has been a while since it was even much of a possibility. In 2021/22 there was an intense scarcity of warehouse space and warehouse managers were so desperate that they were paying premium prices for any warehousing that did become available. The causes of this problem were:


Companies having expanded warehouse space during the pandemic to allow them to hold more stocks close to the end customer.


Companies moving their goods into the UK to save on delivery costs.



However, now there is a little more space coming available,


So maybe it’s time to look at relocating your warehouse?


Reasons to consider switching warehouse provider


  • Prices have become more competitive – in particular pallet storage prices have become more diverse than they were a year or eighteen months ago, in part because there is more demand in the smaller warehouse market as the UK sees an expansion in SME since Brexit, leaving larger warehouses a little less attractive and therefore more negotiable on price.

switching warehouse

  • The golden logistics triangle no longer dominates warehousing – the golden logistics triangle is an area of nearly 300 square miles of the West Midlands, which is theoretically within a four hour driving distance of 90% of the British population. The former dominance of the golden logistics triangle has broken down somewhat due to infrastructure difficulties which have lengthened the theoretical driving time to an actual seven our driving time in many cases, and also due to new ways of managing logistics due to the substantial decrease in available HGV drivers in the UK.


  • Investing in automation is changing how businesses look at warehousing – there is a definite labour shortage in the UK, and at the same time business are needing to be more agile in response to demand, recruiting and training staff has become more challenging and costly, as a result, some warehouse managers are choosing automation as a key component of their warehousing strategy.


Of course it’s nobody’s first choice to relocate a warehouse so why might it be the right time now?


Your current warehouse can’t help you grow – keeping up with demand can be complex – you may already be working with a 3PL that can’t meet your needs, or it could be that you own or rent a warehouse that is too small, or wrongly configured to help you grow, for example not allowing you to undertake cross-docking and that makes it time to move.


You’re just in the wrong place – this is a dual consideration. Are you correctly located for incoming inventory and outgoing orders? This has been a constant pressure for UK businesses in the past three years, as problems with ports, complete shutdowns in air freight and difficulties organising rail freight have all left certain warehouses and even certain product lines, completely stranded. There is often a prime location that balances incoming and outgoing costs – and that might mean moving to a different area.


You need to be better at shipping and freight forwarding – this is the conundrum that was mentioned above in the golden logistics triangle definition. Before the pandemic and Brexit, warehouses in this region did achieve the success rate of being able to reach 90% of the British population within four hours, but the changing UK infrastructure has altered this possibility. Today, with 3PL support and different approaches to logistics fulfilment, warehousing managers are finding ways to improve fulfilment, which might mean moving to a different warehouse space.


You’ve expanded to multi-warehouse shipping – for some businesses, especially those with large or heavy stock like kitchen appliances, agricultural machinery, big decor items etc, multi-warehouse shipping becomes essential. This is a strategy that places inventory close to carefully chosen warehouses and then sends orders to the warehouse closest to the delivery point, thus reducing transport costs. For some companies this means moving from a centralised warehouse approach to smaller, strategically located warehousing space that works well with last mile logistics.


How to choose the right new warehouse for you


Things to factor into warehouse relocation include:


  1. How will you move your inventory?


There always needs to be an overlap between closing an old warehouse and opening a new one – most organisations choose to start fulfilling orders from a new location whilst winding down operations in the previous location. This can mean splitting incoming inventory between the two locations for a period of time, which increases your costs as it means two lots of staff etc, or alternatively completely restocking your new warehouse and operating from there whilst auctioning off the stock in your old warehouse to reduce logistics costs in relocating inventory.


  1. How will you recalculate your lead and delivery times?


When orders are being fulfilled from a new warehouse there are a number of things that may influence fulfilment, hopefully for the better, such as shortening the distance from order to fulfilment, better inbound inventory procedures and more efficient processes. You can theoretically recalculate all these areas but you’ll need to test your theory against actual lead and delivery times and check for accuracy as you don’t want to disappoint customers by failing to deliver as promised. This also has a strong reputational risk attached to it, so it’s really important not to mislead people about what they can expect.


  1. How will you communicate with suppliers and customers?


This very much depends on how you operate. For many customers, this is information they really don’t need, or care about, unless this is going to affect the time or cost of their deliveries. However, suppliers really need advance communication and several reminders and reiterations to be sure that they’ve changed your warehouse address throughout their systems.


If this is the right time for you to relocate your warehouse space, for whatever reason, there are good deals to be had at present, and with a clear eye to your business potential and understanding of the factors that make a successful warehouse relocation possible, many businesses will benefit.

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