A year into the pandemic, and the new reality that's come with it, the need for reliable warehousing and smooth distribution has become greater than ever before.
Widespread in-store closures have accelerated online shopping full throttle, and businesses across industries have shifted to meet COVID-19-related demand, from personal protective equipment (PPE) to vaccine and testing logistics. This spike in online consumption has resulted in a major influx of demand for fulfillment and intralogistics. So what have we learned as warehouses and distribution centers have spent a year ramping up to meet unprecedented demand?
Rising costs. More is more when it comes to warehousing. More demand in supply means more investment to meet it. We’ve seen the cost of labor rise, due not only to an increase in staffing needs, but also the inclusion of hazard pay. Additionally, a higher demand for warehouse labor creates competition for top talent.
It’s not just staffing costs that are taking a toll. With more pressure on the supply chain, shipping costs are increasing, and creating unexpected delays in fulfillment timelines.
Spotlight on safety. In warehousing, safety is always a priority, but the focus is usually on preventing onsite injury, not the spread of a deadly virus. We don’t know when the pandemic will end for certain, or what is to come of the future in a post-COVID-19 world, but we’re confident that maintaining proper safety measures will remain imperative to continue operations and avoid quarantines.
Until we are fully out of the woods, safety precautions will include consistent testing, tracing, workplace distancing technology, and diligent monitoring. Discussing the availability of vaccines with employees, and determining if it will be part of the employment policy, are all things to consider.
Innovative tools. As demand increases, and customer expectations become higher, it will be difficult for warehouses and DCs to keep up without investing in new technology. Operations rely on the technology they have to stay nimble and make critical decisions in regard to navigating the new normal of warehousing. Forty-eight percent of warehouses still use archaic, paper-based processes, and those that don’t act fast will pay the price, as competitors continue to adopt new mobile scanning and warehouse automation software. If they don’t have the most state-of-the-art technology at their fingertips, they might not be able to survive the pandemic from a logistics perspective. We’ve seen a major spike in requests from paper-centric e-commerce and manufacturing enterprises looking to upgrade their system with a flexible platform.
It’s important to have visibility into macro and micro processes in operations, and employ the technology that can offer this level of intelligence. From what we’ve seen, warehouses that do this level of monitoring are the most successful. This is because providing updated tools and software for the workforce unlocks new data that allows operations directors to continue improving supply-chain efficiencies. This includes moving toward a subscription platform for hardware and software, to reduce strain on capital budgets and allow flexibility in volatile times (such as a pandemic). There’s no need to wait to invest, especially when there isn’t any time to waste in a fast-moving industry. Whether companies face layoffs, or must rapidly hire more frontline workers, a subscription platform that flexes with your company allows for a smoother adjustment to the unpredictability ahead.
Demand shows no signs of slowing. We will see continued rapid growth in the online commerce space with an emphasis on home delivery. This will bring challenges in managing increased labor and shipping costs, including those associated with returns, since people will not be shopping in store.
More companies are doubling down on supply-chain productivity to improve the bottom line, and there’s an influx of operations looking to innovate and invest in technology that will enable the frontline workforce. Overall, we’re going to see much more openness to increasing the marriage of human and machine workforces out of sheer necessity. From ensuring the safety of employees to helping employees improve productivity, and also interface with robotic process automation, warehouse managers are looking to ensure the longevity and success of their frontline teams with tech upgrades.
Gabe Grifoni is co-founder and chief executive officer of Rufus Labs, a maker of intelligent wearable warehouse technology and workforce analytics software.
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