Easing the big squeeze. 

January 17, 2022

Why Henderson, Nevada, remains a top location for resilient supply chains.

Recently, it seemed that an unprecedented number of ships delivering to the Los Angeles Port was alone causing the headline-making bottleneck. However, once the other culprit was identified, the news brightened considerably. The Los Angeles Port—the nation’s number one port in container volume and cargo value—was all boxed in, literally, swamped with containers that needed to be removed. Once the Port announced a new “dwell” fee on any container sitting on the dock for more than six days if targeted for rail transport or nine days if intended for trucks, containers began to disappear, a 29% decline in just the first days.

“Shippers are seeing daylight, in a manner of speaking,” notes Derek Armstrong, Director of Henderson, NV Economic Development and Tourism. “That’s great news, and there are a number of other new policies like 24/7 operations being implemented and proposed policies like offsite inspection that are going to improve the flow as well.”

And while the containers are disappearing, what has also disappeared from the L.A. Port area is available warehouse space, which is more good news for Henderson since the city offers abundantly affordable solutions that are ready to go now.

California access at affordable costs.

“We’ve got more than 15 million square feet of prime industrial and warehousing space,” notes Armstrong. “And no cumbersome regulations, either. In fact, we’ve got special Red Team permitting and assistance to get distribution operations up and running fast.”

With Henderson’s location on 1-15, manufacturers and distributors can deliver to California, including the Los Angeles and Long Beach Ports, in a one-day turnaround and enjoy affordable backhaul rates. And that fast access also promises to improve with the new addition of a five-lane widening project at the California/Nevada border.

“California remains a strong consumer market, and the Port of Los Angeles and the Port of Long Beach are the crown jewels of the American shipping system,” Armstrong says. “The Port of Los Angeles facilitated $259 billion in trade in 2020. And businesses located in Henderson can get products there rapidly and affordably.”

Comprehensive Southwest market coverage.

Henderson companies that seek to reach northward also enjoy superior advantages, according to Armstrong, who points to Henderson’s Southern Nevada location that puts more than 61 million consumers within a one-day drive, with two-day delivery possible for every state west of the Mississippi River. Major markets such as San Diego, Phoenix and Salt Lake City can be reached within a half-day or less, and 27 million people and 1 million businesses are within a five-hour drive.

That kind of proximity played a key role in Kroger choosing Henderson as its first Nevada location for distribution. Today, the 482,000 sq.-ft. distribution center allows the company to keep shelves rapidly and reliably stocked in 76 stores across Nevada, New Mexico, Arizona and Utah; the facility’s 270-person team handles 8,000 items per day in a location on the Henderson Employment Corridor near the fast-moving distribution operations of Amazon and a FedEx hub.

After opening a 600,000 sq.-ft. fulfillment center in 2020, in 2021 Amazon followed by opening a last-mile delivery facility nearby. The Employment Corridor gives both operations easy access to I-15 as well as proximity to the Henderson Executive Airport and McCarran International Airport, and to flourishing communities like Henderson’s Inspirada. They also enjoy the competitive advantage of a labor force that can maintain Amazon’s exacting standards of quality and customer service.

Growth, large and small.

Both Amazon and Kroger enjoyed robust growth over the past two years. Amazon’s revenue for the year ending in September 2021 was over $457 billion, a 31.62% year-over-year increase. In its December 2021 third quarter announcement, Kroger revealed an operating profit of $868 million.

Armstrong, however, sees strong growth potential in Henderson for distribution operations of all sizes.

“The pandemic created a lot of challenges, but it has also opened opportunity. It has accelerated a shift to online commerce, for example, which can give small companies a leg up. That makes efficient warehousing and distribution even more important. And with affordable space and fast access, Henderson can make it smooth sailing for any sized company.”