Switzerland faces shortage of warehouse locations as e-commerce demand rises

Like any other nation, Switzerland in the past decade has seen a significant growth in e-commerce from both private and business sector. Fuelling up the demand for logistics real estate, the Swiss online retailers are however faced with shortage of suitable logistics location within the Swiss borders forcing them to outsourcing warehousing or seeking solutions across the border, according to the Swiss Handelszeitung.

As noted by real estate consultant Peter Acél from Zurich, while the demand for real estate is up, the supply in the country is lagging. There are not enough quality logistics properties, he said adding that ‘Efficiency for Switzerland means being process-oriented and highly automated.’

Online retailers are looking for outsourcing their warehousing needs to external specialists who have the resources and focus to construct their own advanced facilities. This is leading to centralization, a trend further intensified when companies need to be more cost-conscious, as is the case currently.

In the meanwhile, the consumers demand for faster deliveries is also driving up, which require decentralized inventories, which can be done when there are more warehouses. It will allow companies to gain customer loyalty and satisfaction by effectively meeting the needs of modern customers, such as same-day delivery.

While in meeting the consumer increasing demand, the location of warehouse plays a crucial role, End-user preferences do not necessarily take precedence.

“The choice of location varies depending on individual requirements and circumstances”, said Anica Raichle, Head of Development at Rimaplan, a Swiss real estate developer and service provider. According to Raichle, end-user preferences do not necessarily take precedence in logistical decision-making processes. She highlighted an ongoing demand for central locations in the logistics industry, as stated in Handelszeitung.

Until now, the actual cost of logistics is not passed on to the customer, says real estate consultant Acél. The scarcity of suitable local warehouse space within in the nation is increasing the retailers’ reliability on major external service providers. They are storing goods in foreign warehouses where wages and transportation costs are lower. To avoid  passing on the the full cost of logistics to their customers, first retailers are building logistics areas in neighboring countries”, as reported by Handelszeitung.

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