February 09, 2018
Posted by Hien Mai

5 Factors to Consider when Choosing Warehouse Location

Deciding on a warehouse location is a significant decision that impacts every aspect of a business -- finding a balance between a convenient location and a reasonable rent price is integral. The location of your warehouse directly contributes to the efficiency of your company as well as the overall customer experience. If you’re on the search for leasing or purchasing a warehouse location, you know just how difficult it can be to make such a monumental decision. Here are some factors to consider to ensure your company’s ability to effectively serve your customers in an efficient, effective, and profitable manner.

1. Desired Consumer Base

When choosing a location for a warehouse, keep your customers’ locations in mind. Determine your customer base and pinpoint the region or regions that you are trying to serve. Having a warehouse location that is in close proximity to your desired consumer base allows for faster deliveries. Not only will deliveries be faster, but the close proximity will also reduce shipping costs. Faster deliveries and reduced shipping costs will positively contribute to the consumer’s overall customer experience -- when the shipping process is faster and cheaper, the customer will be happier and will be more likely to remain a loyal customer.

2. Proximity to Carrier Services

Consider your warehouse’s proximity to carrier services. If your warehouse is located near carrier facilities, it will streamline the process of shipping your product(s) to your customer. Find a good balance -- find a location that offers both convenience and proximity to your customers as well as a carrier service, making the shipping process easier and faster for both your company and the customers. Determine a reasonable balance of distance between the manufacturing location, warehouse storage, and customer and consider the transportation and shipping costs that go with that distance.



3. Storage Requirements

Take account of any special accommodations that you may have to make for your products. Are your products hazardous? Flammable? Fragile? Make sure that the proper accommodations are able to be made at your desired warehouse location. Plan ahead. Don’t waste time and resources finding a warehouse space and then outgrowing the space shortly after. Save time and effort by estimating projected growth to be able to figure out an accurate idea of the storage your company needs. Consider leasing options that allow flexibility in storage space based on changing buyer demographics that your company may experience. Make an educated observation of these factors to ensure the safety of your warehouse location.

4. Workforce Availability

The demographics of the warehouse location may be more important that the physical space. Determine your labor needs. Not every geographic location is able to provide the desired workforce with the right skills and right price. Consider the supply and demand of workforce availability -- low workforce availability and high demand will drive salaries up. Workforce availability can impact overall company costs, therefore doing research on the geographic location is integral. To research and understand the demographics of the area, research the educational attainment and income levels of the city or state, which can be found on government websites. Understanding the workforce is important because it impacts your company’s employee retention and turnover rates, productivity, and employee related costs.

5. Longevity

Consider the longevity of your warehouse location -- will it be able to accommodate the growth or shrinking of your business? Analyze the potential growth of your company and determine if the warehouse location has room for expansion if needed. If your product is seasonal, consider finding a location that offers seasonal leases or working with companies, such as Flowspace, that offer flexible in storage options. Understand the potential of the warehouse space and plan for longevity.

Choosing a warehouse location requires extensive research and planning. Make sure that you consider these five factors when considering potential warehouse locations. The location of your warehouse can be mutually beneficial for your company as well as your customers, overall providing a more efficient, effective, and profitable experience.

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