Santa Claus needs to clone himself

the international director, global leader – Ssupply Cchain & Llogistics Ssolutions at JLL.

While Christmas is busy for retailers, spare a thought for the staff in the warehouses who have to distribute items to customers.

In the past few weeks, they have been getting a workout, particularly in North America with Thanksgiving, Black Friday and Cyber Monday. In China it was Singles Day, which created mayhem for those in post offices and the third party logistics, such as Fed Express and DHL, who deliver the items.

As these key themed-style shopping days get busier and more frequent, it is changing the way the industrial property sector functions in reaction to the rise of e-commerce.

STO Express crew deal with an array of packages on an assembly line in China. Photo: ChinaFotoPress

The Chicago-based Richard Thompson, the international director, global supply chain & logistics solutions at JLL, said Santa Claus needs to clone himself to cope with the demand.

"If you thought that Santa Claus has a tough job of delivering goods to billions of homes in one night … think again.  Santa is finding it even more challenging and complex today," Mr Thompson said.

"The North Pole's supply chain team is going to be working overtime this year! 

"In the "old days", Santa would get a holiday wish list [forecast] far in advance, then put his elves to work in the workshop [manufacturing] the appropriate amount of toys [inventory] to meet the needs demand] of the children of the world [consumers], then he would load his sleigh [pick, pack] and drop packages [final mile delivery] to each house [just in time] for Christmas.

"Santa's job has become even more pronounced in the world of e-commerce. Consumers are making last minute and impulse purchasing decisions with the expectation that they can receive their packages next day."

As Mr Thompson said, the advent of e-commerce has been a game changer for supply chain management, as it creates even more complexity in an already challenging process.

While Australia does not have to contend with winter blizzards like the US, there remain transportation issues that do impact on delivering Christmas gifts on time.

This has led to the "last mile" property sector, where retailers are looking at smaller warehouses near to their shop to allow quick access.

Goodman Group is one that has sites around the ring of Sydney where retailers, who guarantee same day delivery, can lease the site. These are in and around Artarmon in Sydney and the inner ring of Melbourne.

In the US last year, where some parts of the country battled through the polar vortex, an estimated two million express packages due to be delivered Christmas Eve were left stranded on trailers and delivery trucks across the nation, according to tracking software developer Shipmatrix, Inc.

"Santa's helpers, aka UPS and FedEx,  are anticipating the busiest season ever," Mr Thompson said.

"FedEx expects to ship a record 317 million packages during the 2015 holiday season and predicts that package volume will be up 12.4 per cent between last month's Black Friday and Christmas Eve, compared with the same period last year," Mr Thompson said.