The Impact of Fulfillment Centers on the Rural Economy
By: John Gleason
The Rise of Fulfillment Centers
Over the past 15 years, many fulfillment centers have been built across the United States. A fulfillment center is a large warehouse used by major companies to store products before shipping them to consumers. These centers are part of a modern corporate strategy to meet consumers' demands for faster shipping of goods. With a focus on efficient distribution chains, fulfillment centers are typically located in areas that provide easy access to major highways and shipping hubs and are close to significant population centers. Cumberland Valley in South Central Pennsylvania fulfills these logistical needs of corporate America. I will examine some of the impacts fulfillment centers have had on my hometown of Shippensburg, Pennsylvania, a town with a population of about 15,000 people.
Shippensburg, PA
Shippensburg is located in south-central Pennsylvania, approximately 25 miles from the Maryland border. Historically, it has been an agricultural community, with numerous farms scattered across its landscape. After the construction of Interstate 81 through Shippensburg in the 1960s, the town saw an increase in trucking companies, but it largely remained a farming community. However, in 2015, local concerns emerged that Shippensburg would finally undergo a transformation when construction began on the first of what are now five large-scale fulfillment centers based in Shippensburg: Amazon, Walmart, Lowe’s, Procter & Gamble, and Georgia Pacific, with Walmart being the largest at 1,800,000 square feet.
Walmart Distribution Center, located in Shippensburg PA: Source, Penn Live Patriot News
There was initially a concerted opposition among the local population against bringing fulfillment centers to Shippensburg. The opposition feared that the size of these fulfillment centers would result in companies and industrial developers buying large tracts of farmland and replacing the vast fields and quaint bank barns with large industrial buildings, parking areas, pollution, environmental issues, and increased traffic. There were additional concerns that the introduction of the estimated 2,000 to 3,000 workers needed to staff the facilities would create stress on the local housing market and school district and that land prices would skyrocket. Ronald Clever, Broker for Cedar Spring Realty, stated some of the opposition concerns proved legitimate as “there were over 1,000 acres of land purchased over a ten-year period along the Route 81 corridor” in Shippensburg for fulfillment centers on which a collective 7,500,000 square feet of building space was added. Clever added, “The price for agricultural land in Shippensburg increased from an average of $10,000.00 per acre prior to 2015 to $25,000.00 or more per acre today.” While some of the initial concerns regarding fulfillment centers came to fruition, most of the issues raised never surfaced, and the local population adapted to the changes that occurred.
Once the fulfillment centers were constructed, many of the initial concerns vanished. Paul Witter, a local farmer and a former supervisor for Southampton Township, where three of the fulfillment centers were built, informed that the local municipalities were heavily involved in the pre-construction processes to ensure that the new facilities were aesthetically pleasing and that they were engineered, developed and built in a manner that least impacted the local environment. Witter further advised that traffic concerns were identified and addressed in the pre-construction engineering for the projects to limit the effect of the increased traffic from both delivery trucks and the pedestrian vehicles of employees. While there were some who lamented the disappearance of crops, barns, and silos, the Shippensburg community seems to have generally accepted the well-engineered way in which the fulfillment centers were built. They have become a part of the local community.
Proctor and Gamble Fulfillment Center near residential land: HRG-inc.com
Impact on The Local Population
Paul Witter further stated, “farmers have a largely positive perspective on the impacts of the fulfillment centers in Shippensburg.” Some farm owners who sold their land along the Route 81 corridor “could use the proceeds to purchase a greater acreage of land outside of the Route 81 corridor,” thereby increasing their farming operations. Others sold and took their profits to retire or as an ideal time to change professions. Those farmers expanding their operations or just starting their careers are admittedly paying more for farms today than just a few years ago. However, they, too, have adapted. According to Gerald Jones Jr., while it is initially very costly for farmers to buy new tracts of land for their operation, they can still make a profit due to increased prices for their crops and livestock products. Additionally, Jones believes that agricultural land prices will continue to rise throughout the Cumberland Valley region of Pennsylvania, which will be a valuable asset for farmers and their families in the future as they look to sell farms or retire.
A visual of Lowes Fulfillment Center that is located right off of Route 81 Exit 29 Shippensburg PA: Source, Penn Live Patriot News
Finally, while land and housing prices have both increased substantially around Shippensburg at least in part due to the influx of employees needed to staff the new fulfillment centers, this too seems to have very little negative impact on the community. The fulfillment centers have many new employees making a decent salary that are looking for housing and it has helped to bolster the Shippensburg real estate market. Average home prices have increased around 45% over the last 10 years and new construction of homes reached an all-time high in Shippensburg in 2022 and 2023. Currently, in Shippensburg, there is a very robust new housing market and there are very few existing homes for sale. The result of increased property values and new housing has raised additional school tax money to help relieve the local school districts of any burden placed upon them due to the increased population of school-aged children coming to the area.
Shippensburg is a prime example of how fulfillment centers affect rural towns across the United States. While they force an economic shift towards industrial wholesale distribution, agricultural operations can still thrive with their presence. Fulfillment centers have successfully expanded to rural locations, minimizing their adverse impacts on small towns while still becoming a considerable part of the local economy.
References:
Experienced Professionals
Gerald Jones, Principal member of Jones Harvesting LLC,
Paul Witter, a local farmer, and former Southampton township supervisor
Andrew Franklin Esquire, Land Use Attorney in Shippensburg PA
Ronald Clever, Broker for Cedar Spring Realty
Other media sources
Brown, Jimmie. “Take an Aerial Look at Walmart’s New 1.8 Million-Square-Foot Fulfillment Center in Central Pa.: Video.” Pennlive, 14 Mar. 2022, www.pennlive.com/news/2022/03/take-an-aerial-look-at-walmarts-new-18-million-square-foot-fulfillment-center-in-central-pa-video.html. Accessed 17 Feb. 2025.
Corkery, Michael. “A New Crop in Pennsylvania: Warehouses.” The New York Times, 26 May 2021, www.nytimes.com/2021/05/26/business/lehigh-valley-warehouses-ecommerce.html.
Inc, BigRentz. “Mapping Amazon Warehouses: How Much Square Footage Does Amazon Own? | BigRentz.”
Https://Www.bigrentz.com
, 7 Jan. 2022, www.bigrentz.com/blog/amazon-warehouses-locations.
“Procter & Gamble Distribution Center.” HRG - Engineering | Planning | Infrastructure Solutions, hrg-inc.com/portfolio-item/procter-gamble-distribution-center/.
Urie, Daniel. “Lowe’s Will Open Another Massive Warehouse in Central Pa.” Pennlive, 5 Nov. 2020, www.pennlive.com/news/2020/11/lowes-will-open-another-massive-warehouse-in-central-pa.html. Accessed 17 Feb. 2025.
“Work Begins on Large Distribution Center off I-81 near Shippensburg.” Central Penn Business Journal, 13 Aug. 2018, www.cpbj.com/work-begins-on-large-distribution-center-off-i-81-near-shippensburg/. Accessed 17 Feb. 2025.
More about the Author: John Gleason