E-commerce and exports support the growth of Thailand’s logistics sector

Thailand’s logistics sector
There is more demand for warehouses in Thailand

E-commerce is booming and exports continue to increase which is good news for Thailand’s logistics sector. According to a recent release from Knight Frank, both industries will require more warehouse space with leasing activity in the Kingdom having reached pre-pandemic levels during the first half of 2022.

As it relates to e-commerce, demand is increasing due to a few different factors. One is the growing need from major players to expand operations beyond Bangkok and into other areas of the country. Another factor is the arrival of new firms, including Central Group and CP, into the space.

“The e-commerce business is likely to demand even more warehouse space for express delivery services as it becomes more significant in the near future. The continued expansion of the e-commerce industry has created a demand for warehousing bringing substantial changes in Thailand’s supply chain and logistics operations,” the Knight Frank report explained.

The growth of Thailand’s logistics sector is also being supported by booming exports with automotive, agribusiness, chemicals and electronics being in-demand industries at the moment.

“A rebound of international demand after a period of a long disruption will support the rebound of the manufacturing sectors, and consequently drive demand for logistics services and ultimately warehouse space,” the report stated.

The needs of both e-commerce and exports continue to evolve. Firms are now looking for built-to-suit warehouses that meet their unique requirements while offering great technological advancements.

“We continued to observe the trend towards built-to-suit warehouses that are increasingly gaining share from the total space developed by major leading industrial developers such as WHA and Frasers. These developers are investing in innovation and technology to be able to bring and integrate automation, robotics, AI, IoT and Big Data to extend their current offering to modern smart warehouses up to international standards which can increase efficiency and reduce operating costs for occupiers,” the report explained.

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