A multi-billion-dollar investment in FMCG storage and logistics facilities is set to help New Zealand prepare for future pandemic-related food shortages.

When completed, the two purpose-built facilities at Drury South Crossing, the country’s largest industrial and residential development, will cover over 9.8ha hectares and be capable of storing 95,000 pallets and processing over 5,000 outwards pallets per week.

The first stage of the new warehousing should be up and running in 12 months, creating more than 200 jobs.

Sorted Logistics director, Kris Webster, says a global shift in the FMCG industry away from a ‘just-in-time’ towards a ‘just-in-case’ inventory management model is driving demand for managed storage and distribution.

He says their revenues are growing by around 25% annually as the food and retail industries move to maintain consistent stock levels in supermarkets and other retail stores.

“Supply chain disruptions have been a hallmark of the pandemic and New Zealand businesses have adapted to this uncertainty by significantly increasing their inventories of imported and locally made goods.

“In practice, this means a company that used to hold 5,000 pallets of inventory is now holding in excess of 7,500 pallets.

“This additional demand for logistics services is then aggregated across thousands of businesses, which has seen our industry grow significantly – and our forecasts see this trajectory continuing over the coming years,” he says.

Managing director of Cardinal Logistics, Tony Gorton, says the industry is expanding rapidly in response to the evolving macro environment.

He says their new FMCG logistics facility will be the largest of its kind in the country when it opens next year.

“Logistics companies are recognising the growing pressure on capacity as more inventory is needed to help fortify international supply chains.

“We specialise in FMCG logistics, and the new warehouse has been purpose designed to help us move these products more accurately and in greater volumes.

“When complete, the new 40,000sqm facility will be our largest and capable of storing 65,000 pallets of fast-moving consumer goods.

“What we are building here will help provide us with the infrastructure to prepare for, and navigate, whatever form the ‘next Omicron’ manifests in,” he says.