As consumers shift away from in-person shopping to a more convenient way to browse and purchase their favorite items, the past decade has seen significant growth in online retail.
With the growing demand for online shopping, many companies are looking to expand their warehouse operations to accommodate the needs of an ever-increasing online market. There is no better time than the present for real estate investors to secure a profitable warehouse property.
If you are considering investing in a warehouse to tap into the booming e-commerce market, following our specialized guide will ensure you have everything you need before finalizing the purchase.
What to Know Before Buying a Warehouse
Investing in any commercial property is no easy feat, which makes it crucial to know exactly what to do before buying a warehouse. Here are 5 important tips to keep in mind when you feel like it’s time to make the big step.
1. Set Budget Expectations
Having a set budget in mind can help alleviate some of the financial woes that come with buying a warehouse. How much are you willing to spend on the initial investment? Will you be purchasing any equipment or only purchasing warehouse space? Thinking about your expected profit and potential expansion opportunities will help give you a starting point for your budget.
2. Assess Your Inventory
Before stockpiling any goods in your warehouse, you’ll want to ensure that your incoming inventory will be properly stored and maintained in sellable condition. Different types of inventory will have varying needs such as climate controls, humidity regulation, and refrigeration. Prioritize effective inventory management by keeping records of all inventory, analyzing supplier performance, and conducting yearly, monthly, or even weekly audits.
3. Know Your Sizing Requirements
The size and layout of your warehouse will depend heavily on your operations. Buying a warehouse of any size comes with pros and cons, but it all comes down to what your business needs in terms of projected growth or how much inventory you will be storing. A large warehouse will give your business room to grow, but a smaller warehouse may allow you to save on the cost per square foot.
4. Research Your Location
In terms of securing a profitable warehouse investment deal, location makes all the difference in timely delivery assurance. You’ll want to determine your location by assessing your brand and your consumers’ needs. Consider how close your potential location will be to transportation methods such as railways, waterways, airports, and roads. Analyze competition in the area, road conditions nearby, and how long it takes to get onto a major highway.
5. Consider Employment Potential
When everything else is said and done, you don’t want to forget about the people who make the magic happen. Not only do you want diligent employees, but you’ll also want to make sure that your warehouse is a suitable and enjoyable place for them to work. Research unemployment rates in the area to determine whether a high demand for employment exists, while also considering ways you can improve your warehouse’s working conditions.
Looking Into a Warehouse Investment?
When buying a warehouse, focusing on your business should be your top priority. If you’re looking to purchase a warehouse to fulfill all your investing and storage needs, we’ve got you covered.
At Schwarz Properties, we specialize in commercial and residential property management in North Carolina, South Carolina, and Virginia. To learn more about how we can provide you with the property of your dreams, visit our website or contact us at (336)-895-1336.