Warehouse Fulfillment: 12 Things to Know

On a basketball court, each player has a unique responsibility on every play. From boxing out on rebounds to setting picks or screens, each player contributes to the success of his or her team. When executed correctly, the result matches the desired outcome, be it a basket, a rebound or a steal.   These same principles apply within the warehouse as well. And just as a basketball coach understands the X’s and O’s, the logistics and fulfillment branch of your organization should recognize the factors impacting warehouse management. Here are 12 helpful things to know that can enhance your warehousing strategy.

Cost

  • Labor costs can account for 50-70% of a company’s warehousing budget.

Labor Needs

  • The Bureau of Labor Statistics shows that warehouse workers have a turnover rate of 36%.
  • By the year 2018, the material handling industry will need to fill 1.4 million jobs.
  • 62% of distribution center managers claim that hiring and retaining skilled, dependable and qualified workers is their top priority and biggest challenge.

Labor Management Systems

  • Common labor management systems (LMS) include: time recording, attendance software and activity tracking.
  • Currently, approximately 26% of shippers use other technology to manage labor productivity.
  • 72% of LMS users claim an increased ability to measure performance.
  • 57% cite a reduction in labor costs.

Third Party Distribution Centers

  • 24% of shippers use a combination of company-owned and 3PL operated warehouses.
  • A key motivator in leveraging a 3PL is to lower direct and indirect labor costs while enhancing efficiency.
  • 77% of respondents to a Peerless Media Research poll rate continuous program improvement from a 3PL as “very important”.

Pay for Performance

  • Only 29% of survey respondents have implemented a “pay for performance” incentive (basing labor performance against specific KPIs).

*Statistics source: Labor Management Strategies in the Warehouse, conducted by Peerless Research Group

With growing consumer demand and decreasing margins, operating a lean, streamlined fulfillment center has never been more important. With access to data and a strategy to get the most from your labor resources and internal operations, costs can be lowered and productivity can be raised. Barrett Distribution Centers, through a focus on technology and strategy, implements customized supply chain plans that improve business. For more information click here.