Contraction and integration of supply chains to lead to structural shifts in European logistics market

Significant shifts in global trade from recent events such as the U.S.-China trade conflict and the COVID-19 pandemic may cause the global economy to become less integrated, resulting in relocations of manufacturing hubs closer to target markets, according to the latest report from CBRE.

According to the report, titled The Changing Flow of International Trade, supply chains are likely to see a significant shortening and integration, increasing the demand for warehouse space. Retailers and wholesalers are expected to store months of inventory rather than weeks of inventory closer to population centers and service locations, and manufacturers will look to diversify their supply chains so as to be less reliant on specific geographies.

In Europe, there has been an uptick in retailers, such as Decathlon, positioning distribution hubs near Mediterranean ports, rather than centralizing imports, particularly from Asia, in the traditional logistics hubs of Northern Eu