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Employment for 215 Thousand People; USD 20.8 Billion Turnover; USD 7.6 Billion Economic Value Added with Warehousing

With warehousing, 215 thousand people can be employed, a turnover of 20.8 billion dollars and an economic added value of 7.6 billion dollars can be generated.

Turkey needs jobs and jobs that will benefit Turkey, and warehousing can help meet these two needs in a maximum of 5 years.

While there should be at least 40 million m2 of storage space in Turkey today, unfortunately, the total storage space for Turkey can be estimated at 20-25 million m2 , of which 12 million m2 (all in Istanbul and Kocaeli) can be measured. In the next 5 years, 25 million m2 of additional storage space will be needed.

If the 25 million m2 of warehousing space that will be needed in the next 5 years is owned by logistics companies (3PLs) in Turkey, in addition to the employment of 215,000 people (1), 72% of whom are blue-collar warehousemen, 17% white-collar office workers, and 11% managers, a turnover of 20.8 billion dollars (2) can be achieved each year and 7.6 billion dollars of economic added value (3) can be generated each year. In addition to these direct gains from the warehousing service or “warehousing” business line by 3PLs, the taxes to be collected by the state, for the construction of 25 million m2 of warehousing area, the State should give the lands belonging to the Treasury to 3PLs “free of charge” or lease them “for a long time” at a “very low” price on condition that they build warehouses (temperature controlled, normal, open storage), but the State should definitely control these 3PL companies (income, profit, efficiency, business volume) regularly. The construction of warehouses can generate billions of dollars of turnover and economic added value, including other construction-centered businesses, the employment of tens of thousands of people in construction and construction-related sectors, the spending of these employees in the economy, tax revenues, and many other direct and indirect financial gains.

On the other hand, for healthy sustainable growth and welfare increase, Turkey should receive at least 15-20 billion dollars (5) of Foreign Direct Investment (FDI & FDI) every year. At least half of this FDI should be in the “goods”, i.e. “production, wholesale, retail” sector, which must be stored (6). For this amount of FDI each year, 500-550 thousand m2 (7) of storage space is required. But is there a sufficient number of storage areas with the appropriate qualifications for this FDI investment? Unfortunately, NO. If there is not enough qualified storage space in sufficient number and size, FDI will not come to Turkey because there is not enough storage space for production and sales. With 40 Million M2 of storage space, FDI and FDI related income can increase.

Remember. E-commerce is developing and growing faster than expected. E-commerce may need (use) 3 times more storage space than traditional retail. For every 30 Billion TL of e-commerce sales, at least 120,000 m2 of storage space may be required. Accordingly, there should be approximately 2.2-2.4 million m2 of e-commerce storage space in Turkey for e-commerce products worth approximately 550-600 billion TL stored and distributed. In addition, returns reveal the need for more storage space in e-commerce. Is there this much storage space for e-commerce? It is natural that there is none for e-commerce while there is none for normal trade. (8)


(1) Calculated based on 2022 data (number of employees/m2) of Prologis’ 29 warehouses.
(2) Calculated based on Prologis’ “number of employees/m2” data and turnover by economic activity (2023) data from the Annual Industry and Services Statistics prepared by TurkStat.
(3) Calculated based on Prologis’ “number of employees/m2” data and the data on value added at factor cost by economic activities (2023) in the Annual Industry and Services Statistics (2023) prepared by TurkStat.
(4) Value added: A term used to measure the welfare created by a firm, sector/sub-sector (e.g. manufacturing/metal manufacturing) or the economy as a whole. At the firm level, value added is the value that a firm derives from transforming its purchased goods and services into purchasable products. Also used as a measure of productivity, value added is the only measure of “output” in international comparisons of economies or sectors at the macro level. Gross domestic product, which represents the total output of a country, includes the value added of different sectors and is the sum of the value added of individual institutions. As a measure of the efficiency of the production process, the quantity of physical outputs in units produced may be considered sufficient. However, this indicator alone does not reflect the “value” of the product in the eyes of the customer. Value added is a measure of the efficiency of production as well as the additional welfare created by the firm.
https://argemip.org/storage/media/158/ar-ge-katma-deger-olcme-ve-degerleme.pdf
(5-6) NOTE: 2023 FDI 5.6 Billion Dollars (30% production, 17% wholesale & retail
(7) We are Looking for Warehouses but Cannot Find Them
(8) More E-Commerce, More Storage Needs, More Warehouse Space