Bob Silverman, a JLL specialist in supply chain & logistics, will moderate a panel on change - now and in the future - at NAIOP's I.con - The Industrial Conference in Jersey City on June 5-6. Bringing together a group representing tenants, developers, suppliers and logistics experts, the panel has the august title, Evolution of Warehousing and Distribution Paradigms. GlobeSt.com's New Jersey editor Antoinette Martin spoke with Silverman to get a preview of his insights.

GlobeSt.com: Could you tick off three things that have already 'evolved to a new paradigm' for warehousing and distribution?

Silverman: No! Absolutely none of it is decided yet. We are also going in multiple directions. I think e-commerce is going to continue to grow –but its impact varies by sector. It has revolutionized the way we shop for books and entertainment, but other items are still by-and- large purchased in stores, including food and apparel.

GlobeSt.com: Does that mean there will be two types of distribution systems going forward?

Silverman: Virtually every brick–and-mortar retailer today also has an e-commerce requirement. Those with a smaller number of e-commerce orders can glop onto their existing system for warehousing and shipping items to support their stores. For others, it makes sense to outsource to a third-party logistics provider for e-commerce. When I was working with Tommy Hilfinger, we used to handle e-commerce in-house from the warehouse/distribution center. Now they out-source.

GlobeSt.com: What types of buildings do you think will be most in demand in the future?

Silverman: A lot of e-commerce facilities can be re-designed out of existing conventional distribution facilities that have appropriate locations. Because e-commerce facilities “flex” their labor more than standard operations - some operate 24 hours and bring in temps when needed – the car parking requirement is higher. But at pick-pack facilities, those with a lot of piece handling, there are fewer requirements for dock doors for moving palleted goods. This is why we are beginning to see parking lots across unneeded dock doors.

GlobeSt.com: Are there other changing requirements?

Silverman: The clear-height for e-commerce facilities is now typically 36-feet, to allow a three-high picking system. That is two mezzanine levels over the floor, allowing dedicated stations for labeling, gift-wrapping, re-bagging, etc. These are 'hand-pick' stations, where workers individually handle tens of thousands of items.

GlobeSt.com: So e-commerce will dominate the design and location of buildings in the future?

Silverman: Actually, there are still questions as to whether development patterns are changing, or if they are, how dramatically. Right now, building a facility that will accommodate the 'next tenant' in the continuing evolution might require just subtle differences. Part of it involves trying to anticipate the answer to questions like: Is same-day shipping going to become a common rule, or a niche need?

GlobeSt.com: What perspectives will the panelists at the I-con conference panel provide?

Silverman: The really great thing about this is we will be getting the gamut of perspectives. Our panelist from Bed Bath & Beyond represents a retailer that runs a large separate network for its e-commerce orders. We have Intelligrated, a major manufacturer of material handling equipment, Kuehne +Nagel and USAA Real Estate to talk about logistics and changing requirements, and investor/developer Prologis.

Instant Insights /

E-commerce Impact on Industrial? 'Undecided'

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