14
Jan 2021

Logistics service boom

Interest in outsourcing logistics services is growing in the industrial real estate market. Primarily due to flexibility, customers no longer have to make a long-term commitment, and they can adapt the scope of the storage and related services to their current needs. In today’s dynamic times, this is proving to be an interesting competitive advantage. As a response to this trend, 108 AGENCY established a new division which is exclusively responsible for the brokering of logistics services.

The Czech industrial real estate market is feeling the lack of storage space, and at the same time it’s increasingly difficult to promote the construction of new halls. It’s often hampered by negotiations with municipalities, and the lengthy approval of permit processes. Given the extremely quickly developing times, and the inability to predict development, planning takes place for no more than a few months in advance. This all benefits logistics service and outsourcing providers, as well as those with the ability to act flexibly. Companies can then focus more on their main area of business, and don’t have to resolve issues relating to the rental and operation of storage halls, staff or warehouse management IT solutions.

In total, there is around 4 million sq m of space allocated for logistics services which is recorded in rented and owned properties in the Czech Republic. Several dozen logistics companies operate in the local market. The focus of warehouse operations is also diverse, from cold storage and freezing, through specialised ADR warehouses for goods of a dangerous nature, to special storage halls for tyre logistics. We’re seeing the largest growth in the co-called Fulfilment Centre segment, which provides logistics services to e-shops for distribution to end consumers, and provides customers with an additional range of services in an efficient operation, for example transport, reverse logistics and payment systems.

Storage and related services are a complex issue, which requires an experienced approach and professional knowledge. Therefore, over a year ago, Lucie Totzauerová joined 108 AGENCY as Logistics Services Consultant. Lucie is part of the industrial division, and is primarily engaged in logistics service brokering for the company’s clients. “Thanks to the fact that we have an extensive overview of what’s happening in the industrial space rental brokering market, we also have a very good awareness of the demand for logistics services. We systematically interconnect this information, and monitor it in a broader context within our database. Therefore, we know which locations are becoming more popular, and where on the contrary demand is falling,” says Jakub Holec, founder and CEO of 108 AGENCY. “The creation of a new division, which deals only with logistics service brokering, was a logical step. It enables us to react to the market’s very quickly developing needs,” adds Jakub Holec.

During its operation in the Czech market, 108 AGENCY has brokered the placement of almost 84,000 pallets. The largest transactions include 21,000 pallets for LIDL, which were placed in Prologis‘ warehouse in Plzeň, and 10,000 pallets for the same company in the Maurice Ward warehouse in Štěnovice. Another significant transaction which took place last year was the placement of 12,000 pallets for Sportisimo with 4PX.

As part of improving the services it provides to its clients, 108 AGENCY also realised a complete redesign of the Skladuj and Najdikanceláře portals, as well as their Slovak versions. The portals have new logos and are more user-friendly; they also offer content relating to the new menu, which is updated daily, and useful information. A separate microsite, logistickesluzby.skladuj.cz, was also created for free pallet capacity searches; it now also includes a separate category for fulfilment service providers.

Given the market dynamics and increasing demand, we’re expecting further development of the entire logistics service outsourcing segment.

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