Shift To More E-Commerce Means Less Available Warehouse Space In Canada

warehouse space in Canada | Evolution Fulfillment

The COVID-19 pandemic has forced the global economy to pivot dramatically and as a result, warehouse space in Canada is gradually running out.

Warehouse space in Canada may soon be nearly impossible for businesses to find. According to CBRE Ltd’s Canada Market Outlook 2021 report, for every $1 billion in ecommerce sales, 1.25 million sq. ft. of additional warehouse space is needed.

RELATED:

This, coupled with already low vacancy rates, means warehouse space in Canada will be very hard to find and brands will have a tough time finding space to store their products.

Even before the pandemic, Canada lagged behind other developed countries in the E-Commerce sector and that has left many industries scrambling to find warehouse space. According to Group M, online spending (excluding purchases in the food services and catering categories) grew by more than 72.7% last year, totaling $28.6 billion (all dollar figures are in USD).

That growth smashes past the 22.1% growth recorded in 2019 when ecommerce reached $16.6 billion and 3.6% of all retail revenues. In comparison, Australia, which has an economy of similar scale to Canada’s, grew by only 47.7%.

Warehouse Space In Canada Isn’t Being Built Fast Enough

warehouse space in Canada | Evolution Fulfillment

The demand for warehouse space in Canada is so high that the country can’t build new warehouse space fast enough. “With online spending by Canadians forecast to reach $92.7 billion by 2025, net-new warehouse requirements from ecommerce-related demand are expected to exceed 40.0 million sq. ft. over the next five years.” reads CBRE’s Canada Market Outlook 2021 report. To explain the current demand even further, this is greater than all of the leasable space in Canada’s three largest industrial markets combined.

Throughout the pandemic, retailers have been forced to close their storefronts for extended periods of time, which left them scrambling to transition to online sales. These changes obviously couldn’t happen overnight and created new bottlenecks in the supply chain.

There also isn’t one simple solution that will work for every brand. Some businesses have been able to repurpose their space to keep up with online orders and shipments. Other brands have looked at fulfillment centers like the space Evolution Fulfillment offers.

Warehouse Space In Canada Moving Forward

warehouse space in Canada | Evolution Fulfillment

Even as lockdowns end and vaccination rates continue to climb across the country, warehouse space in Canada will be hard to come by for the foreseeable future. Ecommerce will become even more popular amongst consumers and retailers, meaning traditional shopping habits may be a thing of the past.

About Evolution Fulfillment and Our Warehouse Services

warehouse space in Canada | Evolution Fulfillment

With 135,000 square feet, three locations and a variety of specialized distribution services, we help brands reach the entire North American marketplace. We specialize in integrations with various sales platforms accessing everyone from the end consumer to retail giants.

Our main fulfillment warehouse is in Vancouver, Canada, but we also have warehouses in the United States and have access to partner warehouses globally through our Evolution Global initiative.

Evolution Fulfillment provides the experience and resources to operate single client dedicated American and Canadian warehouse operations as an extension of your company. For established businesses, we are able to offer an alternative to the unit based transactional pricing by way of our Dedicated Warehouse Solution. This solution involves a long term strategic partnership charged on an open book cost plus basis, where we provide: customized logistics assets; and, dedicated warehouse space and resources exclusively for your company.

Working closely with you, we provide staff, management, equipment and technology with a dedicated team of people that work only on your distribution requirements. Our efficient and experienced labor structure effectively shields your company from the potential liabilities associated with a warehouse workforce.