Labor, more than half the total cost of the distribution center, is a critical consideration in both delivery and service levels and can be the key to profit or loss. To ensure the proper level of labor, companies must address these key issues:
• Plan and forecast annual workforce budget.
• Establish appropriate level of regular workforce for projected work.
• Optimize the mix of regular, overtime and temporary labor.
• Plan for seasonal changes, new product introductions and promotions.
• Continually optimize staffing levels by day, shift job and zone.
By aligning labor with optimizing the supply chain, companies are realizing substantial savings, increased efficiency, more productivity, higher employee morale, and most of all, higher profits and happier customers.
Not to optimize the distribution workforce to match the new normal in the retail supply chain puts the retailer at a disadvantage in terms of costs, service levels and competitiveness.
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