2022 State of the Market
Just over 12 years ago on September 13, 2010, I opened Industrial Storage and launched our original website to serve the needs of Arizona’s new and used material handling market. Today we introduce our new, modern website aimed to better serve the material handling community going forward. A lot has changed in the past twelve years in our industry so let’s review.
Codes/Permits
Codes continue to change every year and unfortunately for the industry, the codes are becoming more stringent and not less. (More about permits)
- What used to be largely a structural process has been taken over more and more by the fire code so make sure you are dealing with a company that understands the entire permitting process and local ordinances
- Requirements for drawings, calculations, and submittals continue to increase. Beware if you move into an older building that you may need to hire an architect to properly meet the submittal requirements if existing drawings are not available
- Variability between municipalities continues to broaden. Industrial Storage pulls permits all over the US each and every year, and the amount of variance between municipalities is staggering
- Lead times to secure permits continue to lengthen so if you are moving, make sure you account for the permitting process time, including any corrections
- Industrial building vacancy continues to be at historic lows so as retail and other spaces are being converted into industrial space, please make sure you know your requirements before you sign the lease
Supply Chain/Costs
Manufacturing lead times continue to create issues and steel continues to fluctuate on the open market
- Manufacturing lead times on standard products continue to be at historic highs
- Steel continues to fluctuate. A market that was largely stagnant for a decade has continued to be affected by domestic and imported steel cost increases. Quotes are still being provided for shorter lengths to accommodate this uncertainty
- Truck driver shortage continues to plague the truckload and LTL markets securing loads
Real Estate
The commercial real estate market continues to evolve as customer demands change. (Phoenix Industrial Market)
- E-commerce continues its increase in percentage of all distribution
- Micro fulfillment centers continue to increase as companies continue to get closer to their customers for final mile fulfillment
- Sustainability and minimizing a corporation’s carbon footprint continue to evolve and become more of a priority
New MHE Market
New material handling projects continue to evolve
- There continues to be consolidation amongst manufacturers so competitive options are further reduced
- Technology continues to improve product offerings to try and offset the increase of any and all material handling systems. Everything is going up so making products better and faster helps reduce the steel increase component.
- After the pandemic, automation continues to become more and more of an option for more companies. Price points continue to come down. Call if we can help.
- Robots, automated storage and retrieval systems, goods to person, autonomous vehicles, and big data among others continue to drive the industry further into the 21st Automation is not just for big companies anymore.
Used MHE Market
Used material continues to be the sought-after choice for many clients, but things to think about
- Access to used continues to be difficult, especially for larger projects
- As steel and the cost of new MHE equipment have exploded, the cost of used has risen in tandem
- Make sure the specifications of any used material handling equipment you purchase meet your locally recognized codes
- Confirm the logistics of the used purchase and where it is shipping from so any extra freight costs do not eat up all your material savings
Misc.
There are several other miscellaneous items that continue to affect the market
- Cyber security continues to plague companies that do not protect themselves
- Scarcity of talent or just people in general and rise of the worker and worker’s rights
- Personnel safety concerns
- OSHA
Everything listed above will hopefully make it apparent that your best bet is to hire a competent, knowledgeable firm to handle your next project. At Industrial Storage, we pride ourselves on being the most professional and prepared firm in the market. Industrial Storage offers an ala carte type of buying process. We are here to help as much or as little as you desire. From a single used shelving unit to a full blown greenfield distribution center with all the consulting and automation, we can help. We’re just a phone call away.
Thank you to all of our clients and vendors that have made the last 12 years so enjoyable. I started the company with myself as the lone employee with no customers, no website, no warehouse, and no inventory. All that has changed over the years, and we only have our clients to thank for that. We appreciate all of you. Here’s to another great dozen years ahead.
Richard Woolery
President
