Seasonal peaks, consumer demand and labour scarcity. These are just some of the drivers that influence modern warehouse operations. In this blog, we discuss seven key factors that you should take into account when designing your ideal e-commerce distribution centre (DC).
1. Peak management
Holidays, changing seasons and promotional weekends such as Black Friday contribute to online retail peaks, which bring a surge of additional work to DCs. As a result, you need to scale up your operations to process the large amount of orders effectively.
In this situation, there are different options available. For example, an automated warehouse can be scaled up by adding more shuttles to the AS/RS system. Robotics can also help when handling peaks. However, many DCs are not built for peaks, so adding more employees is a viable option. In this instance, training extra staff must be done quickly and efficiently.
2. Unpredictable consumer demands
Beyond the turmoil of Black Friday and other similar spikes in consumer demand, predicting the required volumes of stock is incredibly difficult. Take the weather, for example. During a single weekend, a sunny spell can cause an increase in demand for inflatable pools or summer clothes.
Consumer behaviour, including the response to marketing campaigns, media stories, celebrity endorsements and product placement, also causes unpredictable changes in demand. Given this uncertainty and complexity, managing supply chains is tough. Your operations need to be flexible enough to overcome the challenges of an erratic market. By making use of Big Data, it is possible to make this situation more predictable.
3. Changing lead time requirements
E-commerce is changing consumer expectations. They now demand speed, accuracy and flexibility throughout the entire ordering and delivery process. Same-day deliveries, or even within a few hours, are now an important driver for online businesses.
Your warehouse needs to facilitate short lead times and help you to exceed your customers’ expectations. Delivery windows and same or next-day deliveries are important factors to take into account, and all need to be handled by the same system.
4. Labour scarcity and costs
High labour costs – or lack of operator availability – are other challenges to consider. For these reasons, automation can be a logical option. The scarcity of employees can be eliminated by making use of robotics, for example.
During peak times, more staff need to be operational as quickly as possible. By designing systems and software in a user-friendly way, they can start immediately and without lengthy training.