California’s total GDP is worth $2.5 trillion, making it the largest economy in the U.S. and the sixth largest in the world. Los Angeles County alone is home to over 10 million consumers. That’s more population than can be found in 42 individual U.S. states. Southern California distributors benefit enormously from the robust local consumer base. They also enjoy fast access to nationwide and international markets.
Distributors have countless commercial space options to choose from in Southern California. When looking for local warehouses for rent, you may find it difficult to narrow the field. Sure, you can begin with price. Low prices are great. Just be careful not to make price the only factor. If the space doesn’t work for your business, then no price is worth it, not even free. A botched distribution set-up will have your business shedding cash like a tree sheds leaves in the autumn. Not to say that autumn is something that actually happens in Southern California, but you get what I mean. A serious interruption to a company’s supply chain can erase 20% of shareholder value within six months’ time. Bad! Don’t allow yourself to be overcharged, but do keep in mind that you get what you pay for.
When choosing your warehouse space, you need to consider location, layout, and special amenities, in addition to price. Does your distribution location need to be near a rail line? Do you need cold storage? Do you need forklifts? Security cameras? Software? Are you going to rent, buy, borrow, steal? What else… How many loading docks? How fast will you be turning inventory? Employees?
It’s definitely a process. Most commercial space shoppers take several months to make the right decision.
Now, the good news. Just like bad distribution will punch your business in the gut, a smooth operation is a sure path to profit. If you’re determined to make the best decision for your business, then you have to do your homework and you have to be picky.
Where should you start? Well, as with all things real estate, location is the X factor. Here are three outstanding SoCal locales for distributors:
Moreno Valley is located on the west side of Riverside County. Amazon, Ross Stores, Proctor & Gamble, Philips, Walgreens and many other companies, large and small, distribute out of this Inland Empire location. Most notable perhaps is the massive, 1.82 million square foot Skechers Footwear distribution center. At a speed of 60 mph, it takes a full 30 seconds to get from one end of the complex to the other.
Whether you’re looking for economy or cutting-edge automation and amenities, you’re sure to find an abundance of competitive options in Moreno Valley. Distributors choose this location for its strategic positioning, pro-business culture, and rock solid workforce.
Moreno Valley is located at the intersection of I-215 and SR-60 in Southern California’s Inland Empire region. You can service Los Angeles, Orange County and San Diego very quickly. Key markets in Arizona, Northern California, and Nevada are within same-day reach. You can access Asia via the Los Angeles and Long Beach seaports, only 80 miles westward. Railyards are plentiful throughout the Inland Empire. Air freight and corporate flights are serviced in nearby Riverside at the March Inland Port Airport, and Ontario International Airport is available for passenger flights.
A competitive warehouse and real estate market keep Moreno Valley rental rates affordable. Four major industrial parks offer a range of commercial space amenities and options. Space is well occupied, but there are enough vacancies to provide ample opportunity for newcomers. Meanwhile, new construction and expansion is constant. The recently approved World Logistics Center will add 40.6 million square feet of modern warehousing and distribution space, making it the largest industrial corporate business park in California.
Moreno Valley employers benefit from a dedicated and hardworking labor force. The city itself is the second largest in Riverside County. The city population is 200,000 with 2.3 million Inland Empire residents living within a twenty mile radius. Labor market participants number just over a million. Half of them hold only a high school diploma, creating high demand for lower-skill jobs.
Distributors benefit enormously from Moreno Valley’s Foreign Trade Zone status. Foreign Trade Zones (FTZs) give businesses more flexibility with customs duties. When goods are imported to an FTZ, no customs duties are initially paid. All duties are deferred until the products ship to a US market outside the zone. If imported products are processed inside the FTZ, then exported to foreign markets, no duties are ever assessed.
The Moreno Valley Electric Utility (MVU) offers rate reductions to businesses that use energy efficiently, create jobs, and generate sales tax revenues. Businesses using solar energy receive a rebate of $0.04 per kWh consumed. A lighting retrofit will earn $0.07 per kWh saved. A simple tune-up for your AC or HP unit will earn $75 (per unit serviced) in rebates. MVU also gives businesses rate discounts based on hiring practices. If Moreno Valley residents account for 20% of your workforce, then you receive an additional 2% off of your electricity rates. You get a 4% reduction if 40% of your workforce are Moreno Valley residents.
Moreno Valley’s small businesses get a few additional perks. A small business (less than $200,000 in gross revenues) with a staff of at least 40% Moreno Valley residents, receives a fee waiver when obtaining a business license. Small businesses also get free access to recruitment services from the Moreno Valley Employment Resource Center.