Warehouse Shortage and Observations for 2021

In our previous blog, we mentioned that the
Port of Los Angeles was overwhelmed by increased shipments from e-commerce growth. This unexpected event has caused delays in supply chain networks around the United States. It has impacted not only warehousing but all parts of the supply chain. A culmination of these events has brought a few observations to light that will impact warehousing in the long-term.

Prologis, the world’s leading logistics real-estate investment trust, created a two-installment report that dove into automation as a key to logistics issues in warehousing. Read more about their observations below.

E-Commerce Fulfillment Growth

The unprecedented growth of consumer spending in the last half of 2020, paired with the holidays, overloaded supply chains in the United States. Research by Prologis noted that “e-commerce fulfillment is three times more labor-intensive than other logistics operations.” Labor within facilities has decreased since the pandemic began, and absenteeism amplified the effect. The need for more labor within warehouses is necessary but difficult with pandemic restrictions.

Warehouse Shortage Imminent

Prologis also projected that warehouse availability will experience a shortage in the next few years. They mentioned that e-commerce growth is expected to increase as companies “expand the capabilities of their supply chains.” Warehouse facilities are currently being stockpiled to reduce back stock, and decreased construction of new warehouses only adds to the problem. The report also predicted e-commerce fulfillment will have to double in size to fit a “potential shortfall of 140 million square feet of logistics space by 2024.”

Automation on the Rise

The biggest observation on Prologis’ report is that automation could address the lack of labor in warehouses and optimize logistics operations in the meantime. Automation can streamline processes and speed up production which has the potential to increase revenue. Making the move to digitized operations could improve actions within the warehouse. The report ended with a note that “automation can bridge this gap by improving productivity, enhancing capabilities, and opening up new locations for logistics users.” 


Find effective specialty transportation services that are responsibly priced, timely, efficient, damage-free, and in conformity with the highest industry standards with Pyramid Logistics. We utilize cutting-edge technology to provide your team with the warehousing capabilities of the future. 

Located in Los Angeles, California, and Las Vegas, Nevada, we are equipped to handle a full range of services near our facilities and all over the nation. As the industry continues to go digital, Pyramid Logistics remains at the forefront of warehousing. If you’d like to learn more about partnering with us, click here