Fall is here and with its arrival comes the pre-holiday shopping season. According to the National Retail Federation, more than half of consumers had already conducted holiday purchase research by October, and about one-third have started shopping.
The NRF anticipates shoppers to collectively spend as much as $682 billion this year, up from the $655.8 billion spent on holiday shopping in 2016. While the majority of purchases won't be made until November and December, it's clear that any retailer that hasn't considered how the holiday rush will affect their operations should start preparing sooner rather than later.
Poorly prepared distribution centers and warehouses will likely feel the strain of increased demand this holiday season. As a result, their productivity may be sacrificed.
One of the most common holiday sales-related bottlenecks seen in distribution centers and warehouses surrounds the gift-wrapping station. As many of the orders placed in November and December are intended to be holiday gifts for loved ones, shoppers enjoy the opportunity to choose a gift wrap to dress up their delivery (and to avoid having to wrap the gift themselves).
However, as Dotcom Distribution CEO Maria Haggerty wrote for Total Retail, this option often contributes clutter and confusion around the packing station. Switching from gift wrap to traditional packaging causes packers to slow down and juggle between various supplies.
Haggerty suggested dividing up different types of packaging into dedicated stations. Perhaps one station will only handle gift boxes; another will only handle gift bags; and a third station will only handle normal packaging operations.
The configuration that works best for you depends on your gift wrap options and the size of your packaging area. The goal is to enable the employee to quickly move through packages without having to switch back and forth between processes, as well as to simply divide up your order volume.
Promotional sale problems
Many retailers today are using a new strategy to manage holiday-related spikes in order volume: Instead of having just one or two days of sales (which inevitably welcomes hoards of purchases), they are spacing out their holiday sales over the weeks and even months before the holiday season. This encourages consumers to begin making purchases earlier in the year and aims to cut down on hard-to-manage order volumes closer to the holidays.
When your company promotes certain items in this fashion, you can generally count on orders for those products to increase. Prepare for this by rearranging the inventory your employees will pick from. Put promotional items closest to the pack station, Supply Chain 24/7 recommended. This will decrease the amount of time your pickers have to spend zig-zagging around your warehouse to find the same sale items over and over again. Considering the fact that picking comprises more than half of the labor in most distribution centers, taking steps to simplify the process can contribute to greater productivity.
Additionally, if your promotional items have a specific packaging strategy, be sure it's within reach and easy to find. If it's a new or normally underutilized packaging material or machine, it might be worth the time to train or review packers on how to use it.
Temporary employee troubles
Haggerty noted that another common holiday season struggle is onboarding temporary employees. This year, NRF predicts that retailers will hire between 500,000 and 550,000 seasonal employees. Though an extra set of helping hands around the warehouse is certainly needed during peak season, an inadequately trained employee can wind up slowing things down rather than keeping things moving steadily and efficiently.
There are two major aspects warehouse managers can focus on to ensure seasonal employees are just as helpful as your year-round workforce: excellent training and intuitive equipment.
First, excellent training: Dedicate an experienced employee or manager to training each new employee. After reviewing all the basic operations, have the new hires shadow someone else on the job. Then, once they've had some time to observe, practice and ask questions, let them fly on their own. Progressive suppliers, like Pregis, often provide training and behavioral reinforcement tools to increase adoption.
Second, intuitive equipment: Technology has progressed immensely over the years, and the typical adult can quickly adapt to new equipment – granted it has an intuitive interface. For example, outdated packaging equipment might be challenging to use, refill or adjust the amount of packaging dispensed. A more modern version, such as the Easypack paper packaging solution from Pregis, is simple to get the hang of, making it ideal for temporary employees who're expected to get up to speed quickly. Likewise, selecting a packaging medium that can provide the necessary cushioning protection needed to stand up to parcel shipping and handling is important to create the positive customer experience that is so important during holiday crunch time. Pregis' AirSpeed HC or hybrid cushioning is simple to use, looks great and provides superior protection compared to inflated products that just fill empty space within the box.
Are your distribution centers and warehouses ready for the holiday rush? Now's the time to fine-tune your systems so they can handle increased volume. If you're looking into updating your processes and packaging strategy to increase productivity, reach out to Pregis; we'll be able to assess your current operation and offer helpful advice.