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Commercial Real Estate Economic Development Insider Only Kent County News

Growing fast, USA Fulfillment considers moving

Katie Tabeling

USA Fullfillment in Cheswold is already operating at 70% capacity, and may soon need to find a new facility. | DBT PHOTO BY KATIE TABELING

CHESWOLD — At USA Fulfillment, business has been booming since it opened its second warehouse in Kent County last year.

The logistics company has been so successful, representatives say they are now looking for a 250,000- to 300,000-square-foot location. But the preference is to stay close to the Cheswold location, USA Fulfillment Vice President and General Manager Jay Stamerro said.

“We believed we had a five to 10 year run in this space when we leased it, [but] during the pandemic, our clients’ ecommerce businesses have picked up and the demand for labor and space has increased accordingly,” Stamerro said. “We will be at capacity well before our minimum five-year expectation, so we’re looking for other options in Delaware.”

Stamerro told Kent County officials in November it was a “blessing” to at this point, noting that the Cheswold location was at 70% capacity at this point.

“Our needs are 20 to 25 plus dock doors, high ceilings to use for storage, access to high-speed internet, close proximity to major transportation lanes, and a general office area,” he told the Delaware Business Times. “Linda Parkowski and Laura Wisler [at the Kent Economic Partnership] have been champions for our business growth here in Kent County.”

The news comes after USA Fulfillment invested $1 million in infrastructure, like a shipping system, Cubiscan dimensioning system, package diverters, and a print/apply inline system for shipping labels at its facility on Lynnbury Woods Road.

“This allows our shipping staff to focus on picking and packing orders and place the package on the conveyor which will weigh it – physical and dimensional weight – and print the shipping label and divert it to the correct carrier,” Stamerro said.

USA Fulfillment also received a $10,000 grant from Kent County’s Strategic Development Fund on Nov. 9. That grant will go to more equipment, valued at $500,000, according to county officials.

Kent Economic Partnership Executive Director Linda Parkowski confirmed to the Delaware Business Times that USA Fulfillment is looking to relocate, and that its leadership is in conversations with officials at Sussex County as well as neighboring Kent County, Md. USA Fulfillment’s headquarters is in Chestertown, where it is at full capacity at this point. It also serves as the administrative and call center, as well as housing some warehouse operations.

“The KEP will do everything we can to keep USA Fulfillment here in Kent County and we are committed to finding a location that helps fulfil their growth plan,” Parkowski said earlier this month.

Opened in 1983, USA Fulfillment supports ecommerce companies as well as distribution for business-to-consumer and business-to-business clients. The company is 100% employee-owned and operated out of a warehouse in Chestertown., for years before expanding to a second location.

During a tour with Kent County officials in August, USA Fulfillment Vice President of Operations Dawn Jones noted that Chestertown offered a loyal workforce, but hiring continued to be a challenge. Most of its existing workforce commuted from the First State, and its shipping zones were more attractive for getting packages out the door and to Wilmington and the Philadelphia region.

“For us, it’s important to get packages out as late [at night] as possible. It makes our client happy. Chestertown really limits us with how late UPS and FedEX can pick up packages,” Jones told county leaders while standing in the USA Fulfillment warehouse in August. “But it’s also the people, we find the labor force is better here. It’s been a struggle now, but we do get help from temp agencies like Access Staffing, Integrity Solutions and Kelly Solutions.”

USA Fulfillment’s largest client is Estée Lauder, and right now it pulls and ships the Aveda brand, which is vegan hair products, skin and body care items. Another notable client is LifeStraw, a personal filtration system that made a splash on TikTok earlier this year.

In early 2019, Stamerro and his team worked with the KEP to scout facilities. Around that time, Shoreline Vinyl agreed to buy the former PPG Architectural Coatings site just north of Dover. Shoreline looked to add another tenant to the 163,000-square-foot facility, and USA Fulfillment fit the bill.

In early 2020, USA Fulfillment signed a five-year lease for 78,000 square feet there. By March 2020, the logistics company had fully settled in and relocated most of its product from Chestertown. Then the COVID-19 pandemic hit, and the demand for e-commerce services have put it on a track for exponential growth since.

The logistics center employs about 120 people and can grow as high as 220 people in high-demand times, such as the winter holidays.

USA Fulfillment has not received any state or county incentives, bar the recent grant from the Kent County’s Strategic Development Fund. But Shoreline, which owns the property, was approved for a $10 million conduit bond issuance for the land buy, renovation and outfitting of the new plant. It also received $268,823 from the state Strategic Fund for capital investment.

Editor’s Note: This Story has been updated with comments from Jay Stamerro.

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