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When you think of Arizona, you may think of the Grand Canyon or desert vistas, but this state is actually a great place to base your West Coast fulfillment center. This is mostly due to low costs, high quality service and availability. Here are some things to consider.
It’s obvious Arizona has good weather most of the year, so that’s always a major plus if you want your fulfillment center to stay away from natural disasters. One of the biggest threats to your 3PL is facing volatile weather and possibly affecting operations.
Your warehouse has to keep operating at all times, sometimes 24/7 if you’re dealing with continual e-commerce.
Plus, you’re not far away from major western states like California to cover higher populations. With Mexico at the southern border, you’re also set up to reach Mexican markets in just one day. UPS noted about five years ago already that shipping goods across the Mexican-U.S. border is now faster and easier than ever.
But location alone isn’t the only consideration when outsourcing 3PL, warehousing, fulfillment, and shipping in Arizona. At WarehousingAndFulfillment.com, we specialize in painlessly matching you with the best fulfillment centers in Arizona for your company’s specific needs. In addition to location, we match businesses based upon:
And performance metrics aren’t the only consideration we take into mind. We also match you with companies that are best suited for the products you sell, the channels you sell through, the technologies you use, and any other requirements necessary. Get in touch with your ideal matches today – fill out a request for quotes or call us for FREE matches and quotes!
You might think of Arizona as being a stand-aside place that wouldn’t have any chance of bringing logistics advantages. While the Grand Canyon and Phoenix are perhaps the only places you’ve ever visited in Arizona, it’s worth investigating various cities around the area for warehousing.
The U.S. Southwest isn’t in an awkward location when you consider you’re not far away from West Coast markets (particularly California) while also being one interstate away from covering the Midwest and South.
If you’re considering a 3PL warehouse company in Arizona this year to expand your business horizons, you’re perhaps concerned about international shipping. Since Arizona doesn’t have oceans along its borders, this is maybe the first time you’ve worked with a 3PL away from the U.S. coasts.
The good news is that Arizona has numerous ports of entry, some of which are international. However, with a number of interstate highways, you’re not far away from ports in Southern California. This isn’t to say Arizona may not eventually end up as a leader in world trade due to a possible relationship with Mexico and a new port. Even though you don’t have any waterway ports here, you still have prominent cities providing excellent logistics capability. Another plus is you’ll find a lot of Foreign Trade Zones in Arizona, including in all the major cities. Most are in Phoenix, though it’s time to consider other cities in the Copper State like Nogales, Naco, Tucson, and San Luis/Yuma.
While the above could help in the future, Arizona already gives you a convenient hub to cover the southwest United States. With Phoenix being one of the leading cities in this region, you have plenty of interstate highways nearby for entering surrounding states in one day.
Along with familiar cities like Tucson and Scottsdale, you can corner regional markets you’ve ignored for far too long.
Currently, there’s a push for Mexico to work with Arizona on better international shipping via an improved port along the Mexican coast. The impetus behind this is trade with Asia and finding better shipping outlets through the United States.
Arizona could eventually rival the Port of Los Angeles if this occurs. Because Phoenix and Tucson are both located near one of the nation’s top trucking corridors, the benefits are already in place. Plus, Arizona is better equipped to handle all the legal issues involved with international traders.
It’s one strong reason to find a 3PL in Arizona as a possibly stronger future investment.
Want to save money on your fulfillment operation? Arizona has the lowest labor costs in the nation. It is also ranked as one of the states with lowest costs of doing business. This is mostly due to low taxes and a small state government. If you’re thinking of basing your fulfillment in California, Arizona is a more affordable alternative.
You’ll want a 3PL near many of Arizona’s major interstate highways. Almost all of these highways run through the state’s top cities. Interstate 17 is a good highway for reaching points between Phoenix and Flagstaff. I-17 also connects to popular highways I-40 and I-10.
The latter above is a leading interstate in Arizona because it runs east to west and can take trucks directly into Southern California ports. I-40 is in the northern region of Arizona to take you into nearby states like New Mexico or Oklahoma.
Remember that I-17 additionally gives you a direct connection from Phoenix to Sky Harbor Airport for easy shipping by air.
You’ll undoubtedly turn to Phoenix 3PL warehouses first, despite being a competitive place to find warehousing. What’s most impressive here is the fact that you’re near I-10, which is a major west-east highway through the Sun Belt. Using this interstate, you’ll be easily able to truck products to California, or other states to the east. Within the state, you’re just a short drive away to Tucson, and other southern Arizona towns.
Arizona workers are ready and willing to perform quality work. Arizona is ranked #2 as the top state for workforce quality and availability. This means that your products will be treated with the care they deserve. Furthermore, the driving distance between southern California and Phoenix is only about 6 hours, meaning that overseas freight forwarding services can be brought into Phoenix at a reasonable shipping rate in order to take advantage of the low labor costs and quality labor pool of Arizona.
With three Foreign Trade Zones in Phoenix, you can easily save money if you’re shipping goods overseas. Two of those FTZ’s are in Mesa and Peoria, being two notable suburbs of Phoenix.
Sky Harbor Airport isn’t far away either, giving you a chance for fast air cargo shipping globally.
Finally, you’ll find Scottsdale just east of Phoenix, bringing you a good logistics setup for quick shipments into nearby big cities almost the same day. A lot of fulfillment centers are available in this city.
In Tucson, you can corner a lot of Southern Arizona cities and communities while having advantages in a port and nearby airport. The Port of Tucson has become a major leader in distribution throughout the U.S. Southwest. On a domestic and international basis, you’ll find many intermodal transportation choices, with rail and truck service being the strongest.
This is one of the leading inland ports in Arizona in the way of intermodal and international shipping. They’re positioned in a fairly close spot to the Mexican border (only 70 miles), giving you immediate shipping access south of the border. You can cross into Mexico easily from here through Nogales, Arizona.
The port is large enough to accommodate all types of warehousing and distribution needs. At 1.7 million feet in land space, they still have plenty room to grow. Having a 3PL near here can give you quick access to major highways and 50,000 feet of rail track.
Don’t think that only ocean ports are Foreign Trade Zones either. Tuscon’s port is an active FTZ, plus a State of Arizona Enterprise Zone to help you save money on shipping costs and taxes.
Domestic shipping through here is intermodal, and international shipping gets served through the port of Sonora, Mexico. Many ocean carriers use this port to save money by using rail services for inland shipping. China is one of those, giving you an easier portal into Asian markets.
You’re only a three-day truck drive to Chicago, reaching a major U.S. market. Union Pacific’s Santa Teresa rail classification yard is also soon going to provide more Class I rail service throughout this region.
Shipping internationally covers a wide area, including distribution to China, and into Mexico, near the border.
Located in the Sonoran Desert, Tucson’s continually mild weather makes it excellent for visiting here when you come and visit your fulfillment center. There are a couple of fulfillment centers in Tucson, Arizona, which operate at a very cost effective rate due to the lower costs of warehouse space and wages.
It pays to go to some smaller cities, though Nogales links with Tucson as a combined statistical area. In a case where you can’t find a warehouse available directly in Tucson, going into Nogales is a great place to find many valuable warehousing opportunities.
Trucking is one of their strong suits since you’re right along I-19, one of the top interstate highways within Arizona. This highway has a special designation for listing distances in kilometers rather than miles, yet still gives a straight shot into the rest of the country by truck.
Nogales International Airport is nearby, and they’re constantly striving to bring in more revenues that can benefit surrounding warehouses.
With Naco, you’re right on the Mexican border, giving you easy access to Mexican markets within the same day. Despite all the recent crises related to Mexico, your business can grow exponentially using an Arizona warehouse near the border. They’re basically conjoined if you remember that Naco was once part of Mexico.
San Luis has a little bigger population, and might have fewer warehouses available. Even so, it’s within a Foreign Trade Zone once again, and places you near Yuma, another good city to consider for warehousing.
Choosing the best 3PL warehouse in Arizona is a complex decision. Below is summary information about Arizona population, number of warehouses, and taxes so that you can make a more informed decision about whether the state offers your company the best fulfillment services potential.
|Population||7.15 million (2020)|
|Warehouses in State||16,118 (from reonomy)|
|Amazon Warehouses in State||5|
|Average Warehouse Labor Rate||$20.95/hr|
|Sales Tax Rate||5.6%|
|Property Tax Rate||0.62%|
|Personal Tax Rate||2.59% to 4.50%|
|Corporate Tax Rate||4.9%|
To get an idea of the types of companies that operate in Arizona, check out the top 10 largest companies in the state.
|Business Name||Number of Employees|
|Kyocera Solar||70,153 employees|
|Banner Health||50,000 employees|
|Circle K||40,000 employees|
|ON Semiconductor||36,000 employees|
|Republic Services||35,000 employees|
|Sprouts Farmers Market||30,000 employees|
|Amkor Technology||29,300 employees|
|Apollo Education Group||28,000 employees|
The below table gives a high-level idea of what average rates might look like in Arizona for fulfillment services, based upon surveys of outsourced warehousing companies throughout the US.
|Pricing Type||National Average|
|B2C Order Fulfillment Fee Per Single Item Order||$3.13|
|B2B Order Fulfillment Fee Per Single Item Order||$4.33|
|Pallet storage fee per pallet per month||$16.21|
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