Site Selection Best Practices: Location, Location, Logistics
“Make sure that spatially you’re in a position where you can handle your products effectively and set them up for transport, or the receipt of goods is set up so there are no issues with the logistics,” Dunbar adds. “The more you understand about product inputs and outputs then the better you will be able to effectively map where you should be and how you should be set up.” Any kind of inef ciency in a facility’s logistics can be extremely costly, making it crucial to catch these obstacles early in the site selection process. 2 Understand logistics processes and facility capabilities. When examining a prospective new facility, “it’s not just a box,” Dunbar says. “Understand the internal function of that distribution facility so you can effectively think about what’s happening inside that will end up adversely or positively impacted by the location where it will operate,” she adds. “The critical factors are drawn by the facility’s internal process,” Dunbar says. “Understand those critical factors—is the facility a high electric user? Have
site selection process for warehouses and distribution centers more complex and important in recent years. “You will lose customers if you can’t meet that demand,” says Candy Mitchell, managing director of facility design and automation for PLG Consulting, based in Chicago. “That has to be important when you design your network. “If your customer requires same-day shipments, it will be critical that you site your distribution center where you can meet that customer demand,” she notes. The site selection process also includes anticipating how goods or materials will be handled, stored, and moved within the site and ensuring the site will be able to accommodate how goods are moved as ef ciently as possible. That means planning for the optimized continuity and ow of products because “time is money, especially in the way that you receive and ship goods,” Dunbar says. “Suppose the warehouse needs rail access or proximity to barge,” she says. “We’d make sure that there is a smooth ow and an operational capability to have access to those services so there isn’t an issue with how the product is handled in transit to its destination.
Site selection means weighing the site itself and its physical capabilities, as well as its geographic context and the communities that are in its orbit. Here are the primary priorities to consider when sorting through new sites for your next warehouse or distribution center. 1 Analyze your transportation infrastructure and distribution network. Proximity to customers, transportation infrastructure, and distance to suppliers are critical factors for most distribution center projects. Companies with multiple warehouses should evaluate how a new location will t within the overall distribution network to ensure the most ef cient delivery for its products or raw materials. “Identify how close a site is to key customers and if it can reduce delivery times and costs,” says Nelson Lindsay, a principal with Parker Poe Consulting, a site selection and economic incentives consulting rm. “Is the transportation network in the area adequate for multiple delivery modes including highway, rail, ports and airports?” How a location’s site ts within the constellation of its supply chain is of the utmost importance, as well as how well it provides access to key transportation options. “Be speci c about how far away you are from the raw product, and how far away the product is coming in from, as well as how far you are from the consumer base, or whoever is purchasing the product,” says Courtney Dunbar, director-site selection and economic development leader for Burns & McDonnell, a construction rm based in Kansas City. “It makes a huge difference.” For example, an automotive parts distribution center needs to be located at a site that makes it ef cient to supply an assembly plant that uses the parts. For that reason, “conducting a transportation study is crucial before initiating the search for the project site,” Garner says. Intensi ed customer expectations and demand for rapid delivery has made the
When scouting locations for a new warehouse or distribution center, don't overlook direct rail access, which can reduce transportation costs and boost eciency, especially for companies dealing with high-volume, bulk shipments.
156 Inbound Logistics • July 2025
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