It’s no secret that the supply chain and logistics industries have been plagued with labor challenges since the onset of COVID-19. According to the U.S. Labor Department, vacancies in logistical roles recently soared to more than 5.5 million and 73% of warehouse operators say they can’t find enough labor. That’s almost three times more than the number of operators reporting the same issue a year ago.
Meanwhile, eCommerce and online sales have skyrocketed, leading 58% of businesses to see an increase in fulfillment over the last year. This has created a “rock-and-a-hard-place” situation for fulfillment centers and warehouses across the country facing growing fulfillment volumes while struggling to attract and retain a full workforce.
Fortunately, creative solutions like dynamic storage can help combat these labor challenges by improving facility flow and maximizing the productivity of your fulfillment teams. Let’s review three of the most common (and painful) labor challenges plaguing the logistics and warehousing industries in 2022.
The 3 Most Pressing Labor Challenges in Warehousing
1: Labor Shortages Are Keeping Your Warehouses Understaffed
According to the United States Labor Department, job openings in the domestic supply chain outpace workers by a staggering 5.5 million. And with logistical titans like Amazon publicly struggling to attract workers, it’s clear the shortage is being felt in warehouses and fulfillment centers across the country.
With the Great Resignation still running its course, it’s unlikely these shortages will be filled in the near future. To adapt to this “new normal”, businesses in the domestic supply chain are turning toward efficiency-boosting and labor-optimizing tools and warehouse upgrades to enhance the productivity of their smaller teams.
2: Fulfillment Demands Continue to Climb
The COVID-19 pandemic led to an absolute boom in online sales. The eCommerce industry catapulted from a $657 billion industry to an industry closing in on a valuation topping $900 billion. But those sales have to be warehoused, tracked, organized and fulfilled - a tall order for logistical teams and companies already facing decreased productivity due to understaffing.
And this issue isn’t going anywhere. The pandemic has changed how consumers shop, with 60% visiting brick-and-mortar stores less than pre-pandemic and 43% shopping online for products they previously bought in-store. Even more telling is the fact that 38% of consumers plan to do even more of their shopping online.
3: Overnight, Next-Day and Quick Delivery Necessitate Faster Fulfillment
First, it was Amazon. Now, eCommerce giants and small business owners alike have implemented overnight, next-day, and similar shipping options for their online shoppers. And while this is a fantastic strategy for burgeoning eCommerce brands, it creates increasingly tight timelines for fulfillment centers. Companies are now expected to fulfill more orders faster than ever before, all while fighting an uphill battle against labor challenges.
Understanding Storage Strategy: Static vs. Dynamic Storage
The first step toward understanding how storage solutions combat labor challenges is knowing the differences between static and dynamic storage.
Static storage has been in use for decades in warehouses across the country. Static storage hinges on fixed product locations that never (or very rarely) move or change. While this can make static storage systems easier for new employees to learn and keeps warehouse organization simple, it also reduces the efficiency and facility flow of your warehouse since SKUs are often being stored without regard for the level of throughput required to fully utilize the space.
Dynamic storage is designed to save space and time by storing products more efficiently. Unlike static storage systems, dynamic storage allows you to more effectively utilize the space within your racks. Dynamic storage solutions are designed to be mobile and modular, further optimizing the time-saving and efficiency-boosting nature of the equipment.
Dynamic storage is also a perfect choice for warehouses and fulfillment centers that need the ability to be extremely flexible. Companies that regularly face:
- Seasonal rushes
- Fluctuating order rates
- Or quick order churn
With dynamic storage, you can easily reconfigure product locations and modify storage areas to support the quick and efficient fulfillment of your most popular SKUs.
How Dynamic Storage Eases Labor Pains and Improves Efficiency
The strength of dynamic storage systems lies in their efficiency. And efficiency is doubly important when facing persistent (and potentially long-term) labor shortages. So, how does dynamic storage boost efficiency? It’s all about compounding seconds. It’s well known that the most expensive part of fulfillment is picking. Fulfillment operations regularly spend 60-80% of their total costs on labor, making it an area ripe for optimization. Dynamic storage does just that, reducing both travel and search time to create a more efficient and speedy fulfillment process.
By strategically designing your storage to support the fulfillment of your SKUs based on throughput, you can enhance the productivity of your fulfillment teams and lessen the impact of industry-wide labor shortages. Using dynamic storage to shave even just seconds off of your team’s fulfillment time can have an outsized impact on your overall operation, like:
- Increased pick capacity
- Reduction in variable costs
- Higher employee performance
- Reduced employee turnover
- Improved attendance and morale
In conjunction, these efficiency enhancements can mitigate even the most challenging labor issues.
Ready to Overcome Labor Challenges and Improve Facility Flow?
Here at UNEX, we specialize in using innovative and unique tools to create storage and warehousing solutions that are optimized for our client's specific fulfillment needs. Whether you need to improve fulfillment speed, reduce labor costs, or make enhancements to your fulfillment process to better retain workers, we have the tools, expertise, and experience to make it happen.
To learn more about how dynamic storage can combat your most pressing labor challenges and improve the overall productivity of your supply chain, reach out to one of our experts today.