3PL Perspectives
Dan Khasis | ROUTE4ME
HUMAN LABOR ACCOUNTS for 60% to 65% of total warehouse fulfillment costs, and that doesn’t include shipping. In the last five years, hourly labor rates have increased by around 10% to 15%, while overall productivity has remained flat. This means that the cost per unit worked has increased. In the case of high turnover distribution centers, the cost increased by an additional 15% to 25%.
As most businesses are struggling in the current economy, especially due to the COVID-19 pandemic, it has become even more important to reduce dependence on human labor and get more productivity from existing resources.
To control the rising costs in warehousing and other fulfillment works, it imperative that businesses select, train, and retain good employees.
A well-designed operation, streamlined process, increased use of advanced technology solutions, and automation are key to improve efficiency and reduce dependency on human labor.
Warehouse and fulfillment automation is a viable alternative to increased labor costs. It has also helped to improve efficiency and throughput. The time has come for company owners, managers, and leaders to evaluate each process in the warehouse and fulfillment sectors to eliminate certain processes, or streamline them with equipment.
One process that is helping fulfillment teams expedite their processes is the successful implementation of voice-enabled entry. Let’s look at some of the ways through which fulfillment teams can reduce their dependence on human labor.
Inline Scales
Weighing cartons manually takes a lot of time and manual labor. Implementing inline scales to weigh products for shipping and manifesting can speed up throughput.
Overhead Scanners
Overhead scanners in a shipping department will not only reduce dependence on human labor but will also speed up throughput.
Label Print
This helps to reduce manual processes in the shipping department and speeds up the process significantly.
Power Conveyor
The time it takes workers to move goods as well as the handling costs can be reduced significantly by using a properly configured power conveyor.
On-Demand Box Cutting & Building
To keep up with the demand, especially during the holiday seasons, such as Christmas, many workers are needed to assemble boxes. On the basis of the ordered items and to build the right-sized boxes, warehouse and fulfillment leaders can now integrate many options.
Printing Automation & Delivery
Dependence on human labor can be reduced significantly by using automatic printing and delivery of customer invoices, customer shipping cartons, and spec sheets.
Voice Picking
This involves the use of voice-enabled online apps, so that the dependence on human labor can be reduced in picking up larger and heavier products. Voice-enabled services can be implemented across the entire fulfillment process.
Warehouse Management Systems
With cloud technology in place, Warehouse Management Systems (WMS) have become more affordable. Even a small supply chain or logistics company (of around US$2 million to $4 million) can now invest in a fairly robust WMS. Such a system will streamline processes, reduce labor, and ultimately decrease the operating costs of the company.
With the implementation of WMS, you can achieve same-day processing, so that your business gains a competitive advantage over the big brand names.
WMS helps to:
- Eliminate wrong pickups
- Increase the accuracy of pickups
- Reduce the cost of labor in order picking
A WMS helps optimize warehouse routes, sets up “layout by order,” and uses wave picking.
Wave Picking
Wave picking is a short-interval scheduling type for order picking that helps to organize the daily workflow of a warehouse. It enables supervisors to assign groups of orders into short intervals (known as waves) for grouping by taking into account the workflow for the day, available labor, and the order departure plan.
When wave picking is used along with WMS, managers can easily coordinate several parallel and sequential activities needed for completing daily work. The workload variation in a day can be reduced significantly by the wave.
Wave data usually includes information about the workload (including value-added services, cases, and order lines) by order/function (including case picking, packing, pick position replenishment, pallet movement, and repack picking), so that you as a manager or supervisor can provide management information to calculate staff requirements.
Concluding Remarks
Long story short, if you want to reduce your fulfillment teams’ dependence on human labor, streamline processes, and decrease costs, the increased use of technology, such as WMS or a multi-stop route planner app and automation is the most effective way to do it.
In fact, the new technologies and processes mentioned above can lead to same-day processing, fewer mispicks, and increased pickup accuracy. Thus, with new technology adoption, you can provide greater customer satisfaction.
Dan Khasis is the CEO and Co-Founder of Route4Me, a software platform for route optimization that is utilized worldwide. For more information on Route4Me, visit www.route4me.com.
