Introducing cold chain warehousing and becoming a part of that niche is all the rage, but is this market all that it’s cracked up to be? In this article, we’ll explore the interesting world of cold-chain warehousing, and what it brings to storage facility owners in terms of business opportunities. Take a look at our analysis below!

The Modern Cold Chain Warehousing Industry

The big question on everyone’s minds is - why is the cold chain warehousing industry so big nowadays? Why do all indicators show that it will likely continue growing? Don’t worry, we’re here to answer all of that.

Firstly, let’s consider the past outlook of the storage facility industry. In days of yore, storage facilities could primarily count on their customers being people who needed short-term or long-term storage space for their household items, those who needed extra space while moving with a moving company like Van Express Movers or just people who needed a place for their seasonal clothing or other equipment.

On the other hand, we’ve got storage facilities that were used by product-oriented corporations, more specifically, the companies that outsourced their storage needs. But these days, more than at any other point in the history of the industry, storage-related trends are driven by the end consumer of the stored products. That’s why the cold chain warehousing game is becoming something an increasing number of storage operators are looking into, even if this wasn’t a part of their services before. As you’ll see below, the altering consumer tastes have led to this market opening up quite a bit.

"Cold chain warehousing is on the rise due to shifts in the food industry."

In 2020, an even larger number of production companies will be looking to steer away from the highly processed food items of the past. While these did have longevity in terms of shelf life, the rising health awareness of today’s consumer is pushing them out. Instead, food products are becoming more perishable and temperature-sensitive than ever before. And this has had a major impact on the food supply chain - cold chain warehousing is becoming more important than ever.

Consumer Trends

The consumers of today (with the accent on millennials) expect a larger degree of variety in their products. That’s why food manufacturers are constantly struggling to provide more different options in terms of size, packaging, flavors, etc. But because this need is coupled with a growing demand for products that are truly fresh food, the entire storage and distribution network of these companies is changing.

Seeing as most chilled and fresh products come in smaller quantities than the processed food of the past, large corporations are starting to rely on smaller local cold chain warehousing companies more.

Indeed, it only takes a cursory glance at the grocery and food industry to see just how quickly these changes are happening. In the past 3 years, almost 20 CEOs that led major food corporations have abandoned their positions or they’ve been forced out, with more fresh-oriented executives taking their place. The retail model that food companies are turning to now is far more oriented towards the end consumer; meaning that storage facility operators will have to adjust as well.

Regional supply chains are becoming more important than ever, with temperature-controlled warehouse logistics taking the spotlight. For those maintaining storage facilities, this change is something to think about long and hard.

Need for Innovation

So, what does this mean for storage companies? Especially if you’re about to open a storage facility, you best be ready for some major industry upsets; be prepared for constant innovation, if you want to be a part of supply chains that require cold chain warehousing. The days of pallet-in and pallet-out businesses are gone; the need for flexibility is becoming something of a necessity. You need to be forward-thinking, and constantly ready to adapt. And if you think that cold chain warehousing limits you to being an auxiliary to the food industry, think again, because there is another major sector that has a growing appetite for cold chain storage.

"If you want to introduce cold-chain warehousing, be prepared for constant innovation due to market conditions. "

Pharmaceutical Opportunities

Out of all of the drugs that the FDA has approved in the past two years, more than half represent temperature-sensitive products. Naturally, all of them require refrigeration transportation and storage. Close to a third of them need cryogenic temperatures - meaning below zero. The storage industry is taking this into account. Trade journalists estimate that the global worth of cold chain pharmaceuticals is growing towards $300 billion!

If you think this is old news, think again - as Big Pharma veers towards biologically-based products, they’re in bigger need for cold chain warehousing than ever before. Also, the steadily rising growth of insulin and vaccination-related products is adding further fuel to the fire.

" Big Pharma is another major global industry with a rising appetite for cold storage services."

We’d be remiss not mentioning the other innovations that are pushing the pharmaceutical sector towards cold chain warehousing more than ever. For example, there are new kinds of biomarker testing, cellular therapies and regenerative treatments based on stem cells; all of which require the completion of cold chain tasks. Many of these processes involve extracting blood or tissue from patients and keeping these in a storage facility in the perfect temperature conditions.

In Conclusion

  • Cold chain warehousing is a rapidly rising market
  • The meteoric rise of the cold chain niche is due to the increasing demand from related sectors
  • The food sector requires cold storage because of growing consumer demand for fresh products
  • The pharmaceutical industry requires cold storage because its newest advancements rely on biological instead of synthetic solutions.
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