Fulfillment Centers in Florida: How Population Densities Determine Service Zones

Fulfillment Centers in Florida: How Population Densities Determine Service Zones

A fundamental driver for balancing service expansions from existing FCs and capital outlays for new FCs is population density.

Florida may be ground zero for understanding how FCs handle drastic shifts in population density.

Segmenting Population Density

We used a two-step approach to segment Florida’s population into low, average, and high densities.

First, we calculated a density figure for each of Florida’s census tracts. To get the density figure, we divided the tract’s population by its square mileage.

Median density values for Florida census tracts

Figure 1: Median values for high, average, and low categories. Census tracts with +1.5 standard deviations or greater density were labeled ‘high,’ while tracts with -0.5 standard deviations or lower were labeled ’low.’ All values between -0.5 and +1.5 deviations were considered ‘average.’

Second, we used a DBSCAN algorithm to spatially group tracts within their category. In DBSCAN, the groups are called “clusters.” We then positioned the low, average, and high clusters against each other. In Figure 2, you can see the results.

Map plot of high density and low density areas within Florida

Figure 2: The four metro areas - Jacksonville (‘JAX’), Tampa/St Pete (‘TPA’), Orlando (‘MCO’) and Miami (‘MIA’) - contain 92% of Florida’s high density census tracts. The metro high density tracts surround or touch average and low density tracts. The other 8% of high density tracts dot the areas labeled 1-8. In addition, the figure also shows zones of 5, 10, and 15 miles around the metro areas.

Figure 3 shows the population per square mile, population count, and square mileage for the four metro areas.

High-density metro area statistics in Florida

Figure 3: In the 2020 U.S. Census, 9.9 million people—49% of Florida’s 20.1 million residents—lived in four metro areas covering 1,869 square miles. These areas are far denser than the rest of Florida’s residential zones. Population counts (M) and square mileage of the metro areas are shown within the bars.

In Figure 2, you can see that our labeling of the metro areas extends beyond the actual municipal boundaries of Miami, Orlando, Tampa, and Jacksonville. This raises the question: why did we stop the boundaries of these metro areas where we did? Simply, the population densities drop drastically at these boundaries.

Buffer zones around Florida's high-density metro areas

Figure 4: Population per square mile for MIA, MCO, TPA, and JAX were 6,438, 4,762, 4,389, and 3,381, respectively. The 5-mile buffers around the metros do not reach densities of 1,000 per square mile. Nevertheless, the 5-, 10-, and 15-mile zones around the metro areas had a combined population of 3.7M people.

In the 2020 U.S. Census, 9.9M Floridians lived in the four metro areas, and 3.7M Floridians lived within 15 miles of the metro areas’ outer boundaries. That accounts for 13.6M of 20.1M Floridians. The other 6.5M Floridians live in areas with densities significantly below those of the four metro areas.

Low-density areas in Florida, first set

Figure 5(a): Low-density areas grouped and labeled by city for reference. See Figure 2.

Low-density areas in Florida, second set

Figure 5(b): Low-density areas grouped and labeled by city for reference. See Figure 2.

Three Issues Florida’s Population Densities Present for Siting FCs

1. Can FCs be sited to take full advantage of the cost benefits that high-density areas offer? To do so, siting should minimize the distance between the FC and the majority of delivery points within the zone.

2. Can FCs optimized for high-density areas extend their efficiencies to adjacent, less-dense buffer zones?

3. If low/average areas are well beyond the service zones of high-density FCs, should an operation invest capital in additional FCs at lower ROI, or seek partnerships (e.g., with 3PLs) that already have coverage in those areas?