Mobile Storage Can Enhance Retail Logistics and Inventory Management

The whole world is watching the commercial property industry right now. Day traders are questioning when hotel occupancies will finally start to climb their way out of the abyss. Lenders are watching delinquencies of loans on large retail properties like The American Dream Mall. Human resource and finance c-suites are weighing their options for returning to the workplace—or not. Single family landlords brace for the news of missed rent payments, and then, for the last couple months at least, breathe a sigh of relief when most of what is owed comes in. 

The sector that seems to be out of the public eye, at least for the moment, is the industrial sector. But it too has been seeing a lot of turbulence due to the pandemic. For logistic centers, delivery and return demand is way up as people try to avoid unnecessary trips to the store. For manufacturing facilities, hygiene is now paramount for the spaces employees occupy. For data centers storage is becoming more valuable as more and more people eat up bandwidth working from home. Industrial real estate is undergoing changes as well, just a little less noticeably so than other sectors. 

In our recent Retail & Robots research report, we dove into the growing need for last-mile delivery infrastructure within urban centers. Failing malls, or chronically under-trafficked single tenant spaces near the fringes of the central business district could be repurposed for this use. Sure, it could be re-tenanted with yet another in a long line of retail operators, or it could become something new, something capable of filling a growing need: last-mile distribution space. This kind of space can store plenty of goods, offer space for a workforce to park, and have the necessary room and access to load a delivery truck or van, offering plenty of upside potential for the enterprising adaptive reuse investor. Big companies have caught the warehouse bug, too, with Blackstone referring to the properties as its “highest-conviction global investment theme.”

But what if the storage space could come to you? That’s the idea behind a new wave of companies and ideas making storage of anything, whether food, goods, or otherwise, that much easier. At a local scale, look at the example of Atlanta’s Truist Park baseball stadium, where a refrigerated trailer is currently distributing food to area nonprofits. It’s a perfect solution for communities in transition, or facing crises. Portable storage or distribution solutions allow for a flexible response to rapidly shifting local needs. In the case of Truist Park, a refrigerated truck allows the food distribution site to come to, and stay at, a space that has the ability to serve a large number of organizations. Without the benefit of wheels, the prospect of finding and securing a suitable refrigerated storage space could be daunting.

The opportunities of systems like this extend far beyond just crisis response or powering isolated mining sites. Mobile storage itself is nothing new, just look at the average commercial construction site to see shipping containers, storage on demand, and other haulaway solutions in use, but as the economy digitizes and moves to a largely on-demand distribution model it isn’t hard to see a wide range of uses. 

Mobile storage could function as a distribution point for pop-up stores, for instance, that could never justify leasing space in a traditional warehouse. There’s a retail leasing element here as well. According to Melissa Gonzalez, CEO of retail strategy company The Lion’esque Group, despite changing experiential retail trends, “In some [ways] pop up is going to become even more popular because people are going to be even more hesitant to sign long-term leases out of the gate.” Retailers dealing with demand drops as the outbreak moves into its third month of slamming the country also have the opportunity to use mobile storage to warehouse their backlog of goods. According to Sarah Johnson, trailer leasing company Milestone Equipment Holdings’ senior vice president of Mobile Warehouse and Storage, “The idea of using a trailer for storage has existed for a very long time, but the shift in retail to e-commerce really led to the growth of the storage market, as malls are sitting empty and inventory is sitting in warehouses.”

The future holds rich potential for mobile storage and distribution solutions. Ghost kitchens, where restaurants serve only delivery or pickup clientele without dine-in capacity, are already growing in popularity. Putting them on wheels could allow them to flexibly move from high-demand location to high-demand location, almost like a food truck, but with the addition of delivery drivers or cyclists to expand the distribution range even farther. Thinking even more creatively, there are already outdoor shopping and community centers that use storage containers to house their shops and vendors. Perhaps in the future, entire open-air malls will be mobile, able to set up shop in a parking lot, serve a market, and pack up the next day. If we accept that the need for last-mile delivery systems means growth and change in the retail space, this is merely the logical next step.
As delivery times push ever-downward into the space of a matter of hours, and eCommerce giants like Amazon move into the physical arena with dozens of their own brick and mortar offerings already open, the line between retail and distribution is blurring. Perhaps one day they’ll be functionally indistinguishable, with logistics chains blending directly into the retail shelf, and with mobile solutions capable of bringing the entire system to the highest-traffic areas in a trade area. Until then, expect a gradual ratcheting up of mobile storage and distribution implementations. If that means nonprofit food delivery for now, it seems like we’re already on the right track.

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