Warehousing and distribution have experienced an enormous level of positive and negative impacts over the last few years. Many businesses across the country saw their supply chains interrupted as demand for their products and services increased, declined, or sometimes both. Businesses as well as consumers have learned some valuable lessons about supply and demand and how they are fundamental concepts that influence pricing in a market.

As we entered 2020 and the start of the Pandemic, we saw businesses being shut down and consumers staying at home scrambling to purchase as many goods as possible.  Manufacturing companies that own warehouses quickly found themselves with an excess of space and no product to fill that space, resulting in a huge expense because they were paying for empty space. This caused a surge in production in order to fill this empty space.  Over time, as consumer panic started to ease, and many of these warehouses were filled to (or over) capacity, businesses were forced to eliminate excess old inventory to make room for new inventory.  This too caused major issues regarding the cost of operations.

Through these tumultuous ups and downs, the importance and flexibility of the 3PL warehousing segment has become even more apparent. 3PL stands for Third-Party Logistics.  It refers to the outsourcing of logistics and supply chain management activities to a third-party provider.  A 3PL, such as Air Van Inc, typically offers a range of services such as transportation, warehousing, inventory management, packaging, drayage, final mile delivery,  and freight forwarding. In a typical 3PL arrangement, a company outsources its logistics operations to the 3PL provider, which then takes care of all logistics operations on behalf of that company. 

Companies using a 3PL provider can benefit by saving on operating costs as well as improving efficiency. Manufacturing companies that own warehouse space need to pay for that space whether its full or empty. Empty space equals a huge expense with no revenue to match it. Full space results in the need for outsourcing storage, which usually comes at a premium due to competition for that space. When manufacturing companies outsource the warehousing of their products to a 3PL, they can then hone their energy and financial recourses on producing their goods.  They are only paying for the amount of space needed, not an expansive warehouse that is void of product. As manufacturers use 3PL warehousing, they garner relationships with these companies, resulting in a higher priority placed on their additional space needs when they arise.

Although we cannot predict the future, businesses can use events from the past to make strategic decisions on the best route to take when it comes to warehouse usage.  With 132,000 square feet of warehouse space and 4,000 square feet of cooler room space, Air Van Inc’s warehouse operation has become an asset to many companies transporting and storing goods in the Florida and Georgia areas.  Air Van has been able to help manufacturers and transporters alike reduce operating expenses and improve their overall supply chain operations. Air Van offers both short-term storageand long-term storage options, so whether you need warehouse space for a few months or for a few days, there is an option to fit your goals and budget.

As we continue to see the warehousing environment correct, and warehousing partners modify pricing to come in line with appropriate market rates, the need for 3PL providers will become an even larger part of the supply chain. Businesses have learned valuable lessons on the need for having their own storage space.  Manufacturing companies owing their own warehouse space may soon become a thing of the past.  And businesses can rest assured knowing there are more cost-effective options available that will allow their business to thrive no matter what unforeseen circumstances arise.