GROVEPORT, OH (BRAIN)—Specialized has relocated its East Coast distribution center from Grove City to Groveport, Ohio, expanding its footprint by close to 50,000 square feet. The new building offers 225,000 square feet with the option to lease an additional 325,000 feet.
The Morgan Hill, California company began contemplating a move as its 10-year lease on the old facility came to an end, said corporate distribution manager Kim Peterson, during a tour of the facility Friday.
Specialized considered moving to Harrisburg, Pennsylvania for faster shipping to Northeast states, as well as adding a third warehouse in the south—Atlanta or Memphis—to trim a day from shipments to states like Florida and Texas, currently a three-day shipping route. Specialized has a West Coast facility in Utah.
But after conducting a detailed location study, it determined that the two-warehouse model worked and Ohio came out on top with better transit times, low leasing cost-per-square-foot, good labor force and carriers that offered more competitive outbound shipping rates. The Ohio warehouse, which employs about 42 full-time staff, ships products to most Midwest and East Coast shops in one to two days, Peterson said.
The Groveport facility, which had been built a year ago, remained empty as a result of a depressed economy and commercial real estate brokers were all too ready to negotiate. “The landlord was pretty aggressive trying to fill it,” Peterson said.
About 3 million square feet of commercial real estate remains vacant and is available at fire-sale pricing in Groveport, according to Jeff Green, the city’s director of economic development, and one of several officials who attended the grand opening. “Our pledge is to help the company grow and succeed in Groveport,” Green said.
Peterson said a big selling point was the building’s 35-foot ceilings, enabling Specialized to use higher racking and boosting inventory capacity. Most warehouse buildings have 30- to 32-foot ceilings, he said.
Like at its West Coast warehouse in Salt Lake City, which made a similar move a year ago, Specialized shortened picking patterns. It positioned high sell-through items within the easiest reach and cut drive times on forklifts. A more streamlined pick, scan, package process ensures orders are accurate 99.7 percent of the time, Peterson said.
The new building also has energy saving features like motion-sensor lights, industrial ceiling fans that circulate heated air, and recycled office furniture.
The 10-mile move was done in three weekends during December to minimize the impact to dealers, said Jesse Rogers, manager of the Ohio warehouse, who’s worked at Specialized for 29 years.
Rogers set up the first East Coast warehouse in Groveport, Ohio, 11 years ago, which employed a dozen in 80,000 square feet. A couple years later, it moved to Grove City, adding 40,000 square feet. Another expansion took it up 60,000 more square feet.
Now back at Groveport, Rogers said the larger space means Specialized has the room to frontload inventory earlier to have product available when dealers need it.
“I’m bringing in a lot more containers,” Rogers said. “We’re projecting growth.”