In an era where e-commerce fulfillment has become a competitive differentiator, mall owners are evolving their operations to work with tech-enabled logistics companies to establish micro-distribution hubs in their retail centers. Today more than 60% of mall-based retailers have ship-from-store capability, with malls averaging 950 to 3,200 packages shipped daily, according to Fillogic, the logistics-as-a-service platform.

"Property owners, retailers, and freight delivery networks have long inhabited the same ecosystem, but until now they have not operated as an integrated network," Bill Thayer, co-founder and co-CEO of Fillogic, says in prepared remarks. According to Thayer, tech-enabled mall-based solutions are designed to aggregate demand and maximize efficiencies for all stakeholders.

Fillogic has announced plans to open tech-enabled micro-distribution hubs by July 1 at five major retail properties, four of which are in New Jersey and one is in Connecticut. The mall owners are Brookfield Properties, Macerich, and Taubman and the micro distribution centers will be set up in Deptford Mall, Paramus Park, Stamford Town Center and two other regional properties. By the end of 2020, such hubs will have been set up at 10 locations in the tri-state area, according to Fillogic.

A Wider Trend

Micro-fulfillment distribution hubs is a trend that is spreading across many retail categories, especially the grocery sector. Adding a micro-fulfillment center into the backs of grocery stores — a $2 million-$3 million investment — "could fix critical gaps in online grocery fulfillment, increase store productivity, and make REIT shopping centers even more critical real estate," BTIG analysts Michael Gorman and James Sullivan say in recent research note.

Walmart is experimenting with micro-fulfillment centers from multiple providers, the consultants say. Albertsons is working with provider Takeoff Technologies, and Kroger is working with Ocado on large-scale distribution centers. They expect about one micro-fulfillment center for every four or five of the country's 40,000 grocery stores.

Instant Insights /

Mall Owners Open Micro Distribution Hubs For E-Commerce Fulfillment

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