California is home to many great things like the LA Lakers, the Silicon Valley, and the Beach Boys. One overseen quality of California is its supply chain efficiencies make it a great place to conduct business. California has a skilled distribution network with all modes of transportation available including: air, ocean, rail, and road. Many businesses look to California for its optimal location and cost-effective solutions to store and move goods.
Benefits of warehousing in California:
- Close Access to Ports: California contains many harbors and ports including the Port of Los Angeles and the Port of Long Beach. In fact, 40% of all imports to the United States come through these two ports1. The Port of LA is the top trading port for the United States, totaling an astounding $193.59 billion in trade from January to August of 20142. The Port of Long Beach handles more than 6.7 million container units of goods a year. Having a warehouse near one of these ports will make the movement of goods more efficient, as there is less distance to travel from import to distribution.
- Easy Access for Asia Imports and Exports: California ports are known for their accessibility for Asian imports and exports. The United States currently has free trade agreements with 20 countries, many of which go through the ports in California3. In fact, Los Angeles is the nation’s leading customs district for trade with the U.S.’s top trading partners such as: China, Japan, South Korea, Taiwan, Vietnam and more4.
- Moderate Climate: It’s funny to think how when we were a kid there was nothing better than a snow day. Unfortunately, winter weather does not carry the same nostalgia in the logistics industry. These unforeseen interruptions cause mayhem for businesses across the North East come wintertime. The risk significantly decreases in Southern California due to its moderate climate. Overall warehouse productivity increases and shippers can transport goods with fewer disruptions.
- Campus Environment: Campus warehouses allow for businesses to share resources, employees and management in the distribution centers. The availability of resources can benefit companies that deal with seasonal fluctuation of goods. Shared labor provides flexibility for seasonality or unforeseen flex in the distribution channel. Campus environments also provide more options for warehousing space nearby if distribution needs to expand.
- Proximity to Urban Hubs in California: California also has a lot of Urban Hubs, such as Los Angeles, that give businesses better access to further move their goods nationwide. Ecommerce has evolved the consumers’ expectations, fueling the trend to move distribution centers closer to the urban hubs to cut costs and move the goods more efficiently. Location optimization near major highways provides easy access for transporting the goods as well as accessibility for the workforce.
- Proximity to Rail: Intermodal operations are seamless in California, because major rail systems connect Southern California with the rest of the United States. Businesses are able to transfer goods – from ships, warehouses, or the road – onto the rails effortlessly. This makes California an opportunistic place to integrate intermodal operations with a supply chain.
- Retail Industry Expertise: Many retail businesses have set up their corporate or major operations in the California area to get closer to the manufacturers and the customers. The result is an area with an expertise in retail. It’s become a centralized location for businesses to work closely with their goods throughout the production and distribution processes.
Distribution is an important factor in a business’ logistics and finding the best location is mandatory to having a successful supply chain. Warehousing in California has proven to have many benefits in connecting to both international and national markets. Its proximity to the markets paired with the experience of the workforce make California an ideal place for distribution.