How Energy Efficient Warehousing Can Help Your Bottom Line
Consumers are still shopping brick and mortar retail to try on clothes and stopping by the supermarket for fresh produce, however the retail market is shifting to e-commerce rapidly. Large big box stores are closing more locations and increasing their on-line presence. Smaller retail locations are also competing on-line.
The growth of e-commerce is driving the New Jersey warehousing real estate boom. This demand for industrial space is also helping the construction industry and the Garden State is becoming the warehouse state. Retailers are leasing industrial space creating job growth in the warehousing sector and currently outpacing retail. These e-commerce jobs require more technical skills so they bring higher wages. Amazon already operates one of their largest distribution centers in Robbinsville, NJ and will be opening additional operations throughout the State. Target, Wayfair, Blue Apron and other retailers are also part of the trend. This is great for the Garden States economy.
The New Jersey population is close to 9 million with convenient access to New York, and has one of the largest ports in the United States. Perfectly located with an infrastructure well suited for logistics and distribution to a large percentage of the US e-commerce consumer market.
Energy costs impacts the bottom line and is critical to the financial performance of any e-commerce business model. This is especially true for the smaller retailers trying to compete for their share of the e-commerce market. Businesses looking to maximize their competitive advantage by launching e-commerce distribution centers in New Jersey must recognize the importance of managing their energy budgets.
How does your business use energy?
To better manage your facilities energy costs, it helps to understand how your operation uses energy. Typically lighting and heating accounts for approximately 75% of the average warehousing operation. Efficiencies on these systems are the best targets for energy savings. Refrigerated warehouses are more energy intensive because of the large amount of energy consumed by refrigeration equipment. Regular maintenance of HVAC and refrigeration equipment are important for efficiency and to avoid wasting energy.
Turning off equipment when not in use is always the first recommendation of any energy auditor. Today warehouses use computers and other office equipment that should be turn off overnight and weekends. In today’s e-commerce market this in not always the simple solution, as most operations run 24/7.
Utilities charge for your natural gas based on the amount of Therms used and delivered. Electricity is charged based on delivery, consumption and demand. The consumption and delivery charges are based on the amount of electricity in kWh that a facility uses during a specific billing period. The demand component is the peak demand in Kilowatts (KW) during the billing period and for some utilities during the previous 12 Months. Third party energy supply can save you money, but you must be careful in assuming the risks associated with choosing your supplier and the specific terms of your agreement. NJGEC can certainly help. We are experts in energy procurement and can provide professional services to lower costs and minimize the risks normally associated with third party supply.
Contact NJGEC today to learn about our “holistic energy management” program which is designed to ensure your business receives the greatest value from every dollar spent on your energy budget. To help identify your business short and long term energy management goals, contact us to schedule your complementary energy analysis today. Call us at (973) 287-7797