Many surveys in our industry ask this same or a similar question:
What do you see as your biggest challenge in 2017?
The answers are equally as similar: driver shortage, lack of warehouse talent, and a dire need for supply chain talent in general.
Basically, everyone in our industry seems to be experiencing a labor shortage, whether it’s for driving deliveries from stores to homes, or transporting inventory from a supplier to distribution points, or picking orders in the warehouse. As e-commerce sales growth continues to outpace brick-and-mortar stores, experts say retailers are having trouble filling positions in the heart of their digital operations—their warehouses. With nearly 17,000 warehouses and distribution centers in the US, there are a lot of positions to fill. With labor costing between 50 and 70 percent of the average company’s warehousing budget, improving productivity and efficiencies can help keep costs in check.
The 2017 3PL Logistics Study sponsored by CSCMP and others talks about the rapidly aging workforce in our industry. It suggests a number of strategies to deal with the warehouse labor shortage, including:
- Robots and other automation to speed fulfillment
- Labor management software (LMS systems) that allows more precise allocation of labor based on demand forecasts
- A greater focus on recruitment of women, who currently represent a relatively low percentage of the logistics workforce
- Flexible hours to promote better work/life balance
What if you could solve your labor gap by simply being better at what you do? One way many of our clients tackle their warehouse talent gaps is by focusing on efficiency. If your order picking or packing and shipping process is optimized to eliminate waste and maximize productivity, you can reduce your labor requirements around those processes. When touches and travel time are minimized, the quicker an order can be filled- the quicker an order can be filled, the quicker that worker can move to the next task. This optimization has helped many of our clients reduce the number of workers required to get the job done right.
Additionally, optimizing your processes will make your workers happier- after all, they’re walking, bending, and reaching a lot less than they were previously. This will help reduce your turnover and reduce risks of injury. With more workers staying with your company for longer periods and with less need to cover workers suffering from repetitive strain injuries, your need for new warehouse talent will decrease.