Companies understand the importance of choosing their distribution warehouses carefully especially in regards to their location. There is a balance that needs to be found between transportation costs and the distance that your products will need to travel. Some locations may offer lower logistics rates yet have limited routes available, or the distance to the destination may not counteract the lower logistic rates. Companies also need to decide on the best distribution model for their freight whether that is direct delivery or a hub and spoke distribution model.
Given these considerations, below are 5 top U.S. markets that are recognized for their transportation hubs and competitiveness in the logistics market:
The Chicago area has more than 9.5 million people, making it the third largest metropolitan area in the U.S. This large metropolitan area makes it an ideal midway point for distribution within logistics markets. Chicago also has the largest intermediate switching terminal railroad in the U.S. – the Belt Railway. This railway serves almost every railroad through Chicago and boasts an impressive highway infrastructure with 23 interstate highways in Illinois where commercial trucking makes up 60% of all traffic.
California has the highest population of any state in the U.S. and has large metropolitan areas such as Los Angeles and San Francisco. California also has ideal access to the Port of Long Beach and the Port of Los Angeles along with extensive air cargo facilities. All of this makes it clear as to why California is a key player in the logistics market.
Houston has over 6 million people, making it the fifth largest metropolitan area in the U.S. It also is home to the Port of Houston, which is the second busiest port in the U.S. in regards to ocean freight. Dallas is the eighth most populated city in the U.S. and is very strong in the transportation industry. Texas also provides benefits of having close proximity to Mexico and an extensive interstate system.
Atlanta is the ninth most populated metropolitan region in the U.S. with over 5 million people. Atlanta is known for being a vital logistics as it is only one of five U.S. cities to be served by three major interstate highways and has an esteemed rapid rail station within an airport terminal. Atlanta is also home to more than 75 Class-A scheduled motor carriers and more than 2,000 irregular intrastate route carriers, commodity carriers, and contract haulers.
Florida boasts 15 public seaports, and cargo activities account for close to 9% of Florida’s GDP. Florida is home to three of the most sought after logistics markets – Miami, Jacksonville, and Orlando. Also, the Panama Canal expansion project that will allow the Canal to accept ships nearly twice the current capacity allowance will likely transform the U.S. port system and make Florida one of the key transportation hubs in the country.