How to Work Through Labor Shortages to Fulfill Orders
While high demand is typically a good problem to have for shippers and carriers, it can create significant issues if there aren’t enough hands on deck to move goods, particularly within warehouses. Currently, there is a two-fold issue within the U.S. supply chain. The first issue is that high levels of demand, which is compounded by shippers and retailers increasing their inventory as a buffer against delays, are persisting.
“US consumers have thus far been willing — and able, thanks to falling unemployment (at 3.6 percent in April) and rising wages (up 4.7 percent in the 12 months ended March) — to eat higher prices resulting from inflation. How much more Americans are shelling out at stores and online in April slowed for the first time in eight months, to 8.3 percent, according to the US Bureau of Labor Statistics (BLS) Consumer Price Index,” according to the JOC.
The second issue is the fact that there aren’t enough workers to staff warehouse positions. According to a survey conducted earlier this year by Instawork, a staffing service, over 73% of warehouse operators are reporting a labor shortage.
The lack of staffing can quickly overwhelm many smaller companies and continue to bog down the supply chain. The question is until the supply chain regains some form of equilibrium and demand cools to a more reasonable level, what can be done to mitigate the impact of a labor shortage?
Inefficiency is The Enemy
One of the biggest issues for any supply chain, regardless of the industry, is inefficiency. Historically speaking, the global supply chain at large is rife with inefficiencies. These can include (but are not limited to) poor workflows, outdated systems, and time-consuming analog systems for inventory tracking and order placement.
Inefficiency, in addition to being slower and decidedly more expensive, can cause some serious damage to relationships with customers. Therefore, making operations as efficient as possible not only alleviates growing pressure from the supply chain as a whole but also helps in retaining current customers while attracting new ones.
One of the most effective methods of identifying and, subsequently, eliminating operational inefficiencies is automation. Automation has a number of significant advantages that can quickly help overcome labor shortages.
Some of the Most Common Warehouse Inefficiencies
While this is by no means an exhaustive list, there are certain trends that tend to crop up in supply chains and warehouse environments in particular. Below are some common inefficiencies that affect workers and can easily be corrected by automation
Manual Order Processing: Order processing is the heart of any supply chain or product-driven business. Unfortunately, it’s also the most prone to errors. All it takes is a simple misclick or typo, and order processing can go off the rails. Automating the process simplifies the process and reduces or removes the need for manual inputs.
Inefficient Workflows: Warehouses are very similar to beehives in many ways, with many people working on different things at any given time. However, the means by which an order picker and packer receive an order can have a considerable impact on how quickly and efficiently that order can be picked. A centralized, automated platform can improve workflows and make it easier for workers to do their job.
Training and Onboarding Processes: Even if a company is able to find workers, the onboarding process is something to consider. Typically speaking, the onboarding process can take upwards of 90 days, which is the industry standard “probationary period.” During that time, employees are roughly 25% effective at performing their duties and often won’t ramp up to 100% until the end of their first year on the job. Automating the onboarding process can help make it easy for new hires to jump into the fray while keeping all workers on the same page in terms of operations. Additionally, a good onboarding process can improve worker satisfaction and job retention.
How ShipStation Can Help
Labor shortages aren’t the easiest problem to correct, especially if the U.S. trucking industry is anything to go by. Businesses looking to survive the worst of it will need to be smarter about how they do business, not necessarily by getting more employees (though that certainly helps) but instead by making the most of what they currently have.
Sign up for a free trial to learn how ShipStation can help automate your operations, reduce inefficiencies, and take your supply chain to the next level.