$709.78 billion.
That’s a lot of money. And that’s the amount US consumers will spend on ecommerce in 2020, according to a recent study.
While retail sales have taken a major hit, e-commerce is projected to reach an all-time high this year. As expected, the recent COVID-19 pandemic sent people shopping online like never before. But we were already seeing this shift away from brick and mortar to online sales before the coronavirus ever hit.
The convenience and accessibility of online shopping makes it almost irresistible in our fast-paced, on-demand world. For those of us who didn’t grow up in the e-commerce era, it’s sometimes hard to wrap our heads around how quickly we can have a new tool, shampoo, book, food, toilet paper—just about anything else you might want or need—delivered to your doorstep.
With over two decades in the construction industry under my belt, I watched e-commerce hit the scene and change over time. I’ve been regularly immersed in the e-commerce build arena since 2000, and let’s just say this “trend” isn’t going anywhere anytime soon.
Here at Compass, we’ve watched our e-commerce work grow steadily in recent years. This year alone we expect more than 40% of our business will fall into this category. And we expect an upward trend to continue for us as online shopping continues to dominate retail.
It’s been exciting to see how e-commerce has shifted the landscape of retail—and construction. Let’s take a quick look at some of the biggest trends right now when it comes to e-commerce builds.
E-Commerce Build Trends
-
01
Build-to-suit Construction
Bigger e-commerce players like Amazon and Walmart sometimes have the time to design warehouses exactly to their needs. From column spacing and clear height to insulation values and outlet placement, every little detail is planned out ahead of time to maximize efficiency and productivity.
When timeline allows, we get to build from the inside out, and are able to work with developers and tenants to get everything just right from the start. -
02
Spec Buildings
Things in the e-commerce world are moving so quickly that build-to-suit sometimes doesn’t keep up with demand. In these cases, developers will hire companies like Compass to build out spec sites in anticipation of future tenants. Here’s where we have to get really creative, working quickly and meeting ever-changing market needs. Sure, there’s some guesswork involved since the future tenant is unknown, but staying on top of market trends helps us make the finished building more desirable.
-
03
Phasing
Speed to market is everything in the e-commerce world, so sometimes it’s critical to get tenants up and running (even in a smaller capacity) quickly, and continue building out from there. Our team has become savvy at phasing work in a way that maximizes productivity for the client and sometimes has us working alongside tenants as they wrap up interiors and start moving product.
-
04
Changes in Clear Height
When more storage space is needed, people often think of building out. But occasionally it’s more cost-effective to actually build up instead. Any cross-dock building in the Indianapolis market needs built to a minimum 36’ clear height. But in recent years, we’re seeing many folks move to a 40’ clear height, giving them more cube space.
-
05
Dock Positions
Another detail we’re seeing shift in the e-commerce space is an increase in dock positions. It used to be that one dock position per 10K square feet was the norm. But developers are realizing that tenants are often looking for more. In fact, Compass is building one at the writing of this blog that will have 190 positions for 660K square feet. Building in added dock positions from the start is far more economical than doing it later, so this is something we bring up with clients early on.
-
06
Bay Size Shifts
These days you’re seeing 54’ bays (in the long direction) more than ever. We see everything from 50-60’ bays, but many users are often wanting 54’ from the start. This size works well with narrow (or even very narrow) aisles, which we’re seeing more of, too. Again, these are the kind of details we iron out as early as possible to avoid headaches or added cost.
There’s no doubt we live in a different world today than ever—especially with COVID-19 hitting the scene. No matter what happens with the economy, I think e-commerce will continue to dominate. At Compass, we’re thrilled to be leaders in this building space.
Some folks say that warehouse work is simply building a box. But we know the devil’s in the details. These types of builds take massive forethought, coordination, and logistics. The key is listening deeply to developers and clients to find out what’s important to them. Once we truly understand the needs and desired outcomes—and really see the project through their eyes and not just our own—we know we can make it happen.
