When Proctor & Gamble opened its new 806,400-sq.-ft. (75,000-sq.-m.) distribution center July 31 at the Gateway Commerce Center in Madison County, Ill., the event served as further confirmation that the St. Louis metropolitan market is poised to become the next major distribution hub for North America.
      The success of Memphis, Tenn. -- the international headquarters of Federal Express --as a continental logistics hub is well known by now. But can St. Louis become the next Memphis? Art St. Onge thinks so.
      "St. Louis has a bright future as an inter-hemispheric transportation and distribution hub," says St. Onge, president of the York, Pa.-based St. Onge Company, a firm that specializes in logistics analysis and strategy for optimizing distribution networks. When Proctor & Gamble opened its plant in Madison County, St. Onge was on hand to present a report on the future of St. Louis as an international logistics center.
      According to St. Onge, the top location candidates for distribution centers in North America are Seattle, Los Angeles, Denver, Dallas, Atlanta, Memphis, Harrisburg, Pa., Chicago, Columbus, Ohio and St. Louis. Of those cities, St. Louis is physically closest to the population center of the U.S. St. Louis also serves as the interstate and railway crossroads of America, says St. Onge, while providing waterway access to both the Great Lakes and the Gulf of Mexico via the
Mississippi River.
      As the new economy drives further streamlining of supply-chain management, St. Onge predicts that three trends will begin to dominate SCM: postponement, consolidation and outsourcing.
      Postponement allows manufacturers to make a semi-finished product that doesn't become customer-specific until it reaches the manufacturer's distribution center (e.g., Dell Computer). Consolidation allows the various consumer products companies to join forces to provide "one face to the customer" (e.g., Kraft/Nabisco). Outsourcing is the replacement of traditional distribution channels with third-party logistics providers.
      St. Onge says that St. Louis, because of its transportation infrastructure and its proximity to major North American population centers, could become the preferred Midwestern location for logistics companies in the next decade.
      "St. Louis is a pretty balanced market. There is roughly the same amount of manufactured goods coming into the market as are going out," he says. "St. Louis also has three sizable automotive plants: one each for Ford, GM and Chrysler. Plus, St. Louis is in an ideal location from a transportation standpoint, being at the crossroads of both the interstate highways and the rail lines of Norfolk Southern and Union Pacific. Our research shows that a high percentage of rail freight in this country travels directly through the St. Louis market. Our job is to make the case for why that product should stop in St. Louis and pass through a logistics facility."
      St. Louis isn't the only Missouri market reaping the harvest of the supply-chain revolution. A number of national and international companies chose to make Kansas City their global or regional headquarters this year.
      The Greater Kansas City area's first major announcement of 2001 came from Grundfos Inc., a Denmark-based manufacturer of high-tech pumps. The company announced earlier this year that it will relocate its North American headquarters and operations center from Fresno, Calif., to Olathe, Kan. Grundfos will employ 101 people in a $US4 million, 59,000-sq.-ft. (5,487-sq.-m.) facility at an average annual salary of $78,000. Also planned for the site is a separate 75,000-sq.-ft. (6,975-sq.-m.) headquarters facility, 25,000-sq.-ft. (2,325-sq.m.) maintenance/service center and 100,000-sq.-ft. (9,300-sq.-m.) distribution center.
      Other major announcements in the Kansas City area this year include Intervet Inc.'s 215,000-sq.-ft. (19,995-sq.-m.), 315-acre (126-hectare) campus employing 170 people in DeSoto; the relocation of the National Association of Intercollegiate Athletics to Olathe; and American Ingredients' $10 million expansion in Grandview.