Top 10 Cities for a Distribution Center

Selecting the right geographic area for a distribution center is a critical decision that can significantly impact a company’s logistics efficiency and overall success. Distribution and logistics play vital roles in ensuring that products are delivered to customers promptly and effectively.

Historically, distribution centers have been situated near centralized population hubs, as these locations provide the necessary infrastructure and access to large consumer bases that support robust logistical operations. Cities with proximity to major transportation networks—such as airports, railroads, and seaports—are particularly advantageous, especially coastal cities that facilitate international shipping.

The strategic placement of a distribution center can drastically reduce delivery times, lower transportation costs, and enhance customer satisfaction. In an era where consumer expectations for fast and reliable delivery are at an all-time high, the geographical location of warehouses is not just a logistical consideration; it is a fundamental aspect of supply chain strategy that can determine a business’s competitive edge in the market. 

Where should you be looking? Here are the Top 10 locations for a distribution center. 

1. Dallas/Ft. Worth, Texas 

Dallas has grown to the fourth-largest metropolitan area in the US. The transportation options provide easy access to the Western states, the Southern states, and Houston (which itself has access to the Gulf of Mexico). In fact, most ground carriers can reach 93% of the U.S. population from Dallas within two-days.

Population density is also important when it comes to selecting a warehouse. Finding the right people to work within and support your facility matters. Dallas’s skilled, growing workforce makes it a prime home for your warehouse. 

2. Phoenix, Arizona

In recent years, Phoenix has emerged as a premier location for a DC. It’s strategic location being at the top of the list — 33 million people live within one-day shipping distance, serving most of the Southwest market and beyond. 

This close reach is driven by Phoenix’s robust transportation infrastructure. The city is well-connected by an extensive network of highways, including Interstates 10, 17, and 40, facilitating efficient ground transportation. Moreover, it serves as a significant hub for both Union Pacific and BNSF Railway, enhancing intermodal transport capabilities. The presence of Phoenix Sky Harbor International Airport further supports logistics operations by handling substantial cargo volumes and offering numerous domestic and international flight options.

3. Savannah, Georgia

Savannah, Georgia, stands out as an ideal location for distribution centers due to its strategic advantages in logistics and transportation. As the largest single-terminal container facility in North America, the Port of Savannah plays a crucial role in facilitating efficient cargo movement. It is the third busiest container port in the United States, handling a significant volume of cargo—over 5.4 million TEUs in fiscal year 2023—and is projected to expand its capacity to 12 million TEUs by 2030. This robust port infrastructure allows for rapid shipping and access to both domestic and international markets.

Connection to highways such as Interstates 16 and 95 provide one-to-two day reach to 44% of consumers and other hubs. 

The Savannah area appears to be encouraging the growth in the logistics market, investing in industrial and warehousing space for businesses to fill. 

4. Inland Empire, California

Located East of Los Angeles, centering around the Riverside and San Bernardino areas, the Inland Empire has maintained its top spot on this list for decades. Why the high value? Approximately 40% of goods entering the U.S. flow from the nearby Port of Los Angeles. It’s also along Interstates 10 and 15 and close to several major railroads and airports. 

For this particular location, you will pay for convenience, though. Warehouse rents stay at the top of the market – sometimes doubling and tripling other areas on this list. 

5. Chicago, Illinois 

In addition to being the third-largest city in the United States, Chicago has long served as a commercial hub for the country, spanning back as far as the era of Westward Expansion. Its geographic positioning and large transportation infrastructure significantly reduce transport times and cost to a majority of the population. 

A part of Chicago’s fantastic transportation infrastructure are seven Class I railroads that all converge in this area. Rail continues to be a reliable and economical method for moving goods over long distances — carrying the equivalent of 3.5 to 4 truckloads. In some cases, even reducing your company’s carbon footprint. 

6. Allentown, PA

While rents in the New York and Jersey areas stay high, we recommend looking across the border into Pennsylvania for the same easy access to Northeast populations, skilled workforce and lower costs. 

Allentown is served by major highways such as Interstates 78 and 476 and Route 22, as well as rail terminals. With easy access to the ports in New Jersey and New York, companies can take advantage of the lower rents compared to neighboring states and the growing, skilled labor there. 

7. Atlanta, Georgia

Home to the busiest airport in the world, it’s no wonder Atlanta is making its rise as a transportation hub. The unparalleled access to major markets allow companies to reach 80% of the population within a two-day truck drive. 

If road isn’t your transportation method, Atlanta’s Hartsfield Jackson airport or new Appalachian Regional Port are both options for moving goods, allowing for agility and optimization in your network. 

When selecting the workforce, Atlanta has the third-fastest growing metro population, which offers a large job pool for companies to choose from. 

8. Indianapolis, Indiana 

Indianapolis gets its nickname “Crossroads of America” because of its central geographic position. 75% of the U.S. population is a one-days drive away. This accessibility significantly reduces shipping times and costs. 

DC’s can take advantage of highways such as I-65, I-70, I-69 and I-74, as well as several Class I railroad connections and the Indianapolis International Airport, home to the world’s second-largest Fedex Air facility. It’s location on the bother of Missouri and Indiana provide access to two state’s populations of skilled workers. 

9. Las Vegas, Nevada

When trying to avoid the high rents of the Inland Empire, Las Vegas may be the place for you. When compared to transportation costs from the port, the lower rents offered by Las Vegas make it a considerable refuge for company’s who need access to the western side of the nation. 

Vegas allows companies to still reach key urban areas like Los Angeles, Phoenix and Denver, through well-developed transportation infrastructure, rail connections and Harry Reid International Airport, and can support businesses with its growing population. 

10. Memphis, Tennessee

A central location in the U.S., Memphis offers one-to-two day road access to nearly 70% of the U.S. population on both the East and West sides of the country. 

If Parcel is your preference, Memphis houses the Fedex World Hub, the largest sorting facility in the world — also making Memphis International Airport the busiest cargo airport in the U.S. Memphis has long been considered a hub for logistics, especially trucking, and with access to 11 major interstate highways and home to over 400 trucking companies, we know why. 

Where are you taking your warehouse?

If you’re looking to maximize efficiency in your distribution centers, you need to factor in more than just the location. After all, a poorly organized distribution center in one of these major cities will still struggle to stay lean and excel in quality work.

See where Kenco has placed their national network of warehouses in our Interactive Warehouse Map. 

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