As with many major changes in the warehouse industry, we can thank (or blame) the rise of ecommerce for the sharp increase in hyperlocal warehousing.

As part of the ‘last mile supply chain’ way of thinking, hyperlocal warehouses put a stronger focus on LTL loads and last-mile deliveries to get products to nearby customers faster than usual. If you’ve fulfilled (or ordered) anything that had to arrive to the customer within the day, and the customer was in a geographic location not far from you—congratulations, you’re now part of hyperlocal distribution and warehousing.

This change has shifted the power from the producer to the consumer, in ways that affect the warehouse industry more than you might expect. Customers can now request pre-scheduled, pre-released deliveries of products that may have taken a few days to make it down from the main distribution centers in the old days, and customer expectations have been adjusted accordingly.

 

Where does this leave your warehouse? So long as you focus on flexibility, you’ll be able to keep up. Hyperlocal warehouses and distribution centers need to be designed to respond quickly to incoming requests, be it from retailers they serve (such as the current Best Buy ship-to-store model) or directly to the customer depending on how the products are sold.

This may require a little shaking up of your priorities. If your warehouse is serving hyperlocal audiences, you’re going to need to focus less on long-term inventory storage and inventory balancing, and more on getting product out as quickly as possible. Rearrange your pallet racks to offer better access to the most popular product, and provide extra steel shelving and wire shelving throughout the warehouse to keep products and shipping goods well within reach.

 

You’ll need to rethink your shipping practices, too. Hyperlocal warehouses, ideally, will handle each order on a case-by-case basis, but this does provide a chance to get your staff up to speed with item handling. For last-mile deliveries, make sure your entire staff has a well-defined role and a clear understanding of their role in the process, from picking to packaging and so on. This will prevent slowdowns and make sure there’s no confusion when the superfast last-minute orders come in—the sort of orders you’re bound to get when you serve a hyperlocal audience.

 

Keeping a good relationship with your vendors is also key. LTL distributors will be just as pressed for time as you are, and will need their goods unloaded as quickly as possible when they arrive. Make sure your vendor KPIs align with your distribution goals, especially if you’re acting as a midpoint for goods—in many cases, hyperlocal warehouses will only exist to get the goods off the truck, properly labeled and packaged, and sent right back out to their final destination like a customer’s house or another retail location. Even if this leads to some awkward conversations, make sure your vendors are on the same page as your staff to keep the deliveries moving where they need to be.

 

Otherwise, running a hyperlocal warehouse isn’t much different from what you’ve always done—you just need to be able to do it faster.

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