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The Amazon Effect: the growth of distribution centres and their impact on housing

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An increasing number of consumers are choosing to shop remotely, their location only bound by the need for a decent enough internet connection. Retailers have responded to this and more and more products can now be bought online and delivered straight to the customer.

Of course, online retail is nothing new but has been accelerated by the pandemic as both businesses and consumers were forced to transact virtually.

Research shows that this shift has created a need for spaces to store and process products as a constant flow of orders are fulfilled. And with online retail forecast to continue growing, we are likely to see more large-scale warehousing appear across the UK.

We wanted to look at how this transition would impact the areas where the warehouses were situated, so we worked with research agency Opinium to examine factors such as employment and business, the environment and housing.

To make like-for-like comparisons between different local economies, we honed in on one company that has been at the forefront of the e-commerce boom – Amazon.

What started out as an online bookstore, has grown into the world’s biggest online marketplace, AI assistant provider, live-streaming and cloud computing platform, as measured by revenue and market capitalisation. This has resulted in Amazon becoming the world’s most valuable brand according to a range of measures.

The company opened its first UK fulfilment centre in Marston Gate in 1998 and has continued to expand ever since.

In our report – The Amazon Effect – we examine how the opening of 10 more Amazon fulfilment centres has impacted the economy of the Local Authority in which each was based in the 12 months after launch.