ASSESSING YOUR WAREHOUSE LOGISTICS NEEDS - Global Trade Magazine
  December 31st, 2018 | Written by

ASSESSING YOUR WAREHOUSE LOGISTICS NEEDS

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  • In 2015, only 55.1 percent of companies were leveraging load optimization and performance monitoring.
  • "It takes unconventional thinking and a broader set of collaborators to make smart changes.”
  • It’s a fine balance between evaluating what’s not working and applying a new strategy and not going idle.

As 2019 planning takes shape, consider your company warehousing needs beyond the numbers and take a hard look at the logistics structure from the last year. This begins with an honest assessment of what is and what isn’t working from an operations standpoint as well as employee satisfaction and culture, digital optimizations, labor and productivity, and risk management.

Such companies as Datex Corp., a leading solutions provider, spotlight the importance and top priorities that should be considered the most important for implementation and success initiatives. It goes without saying that technology innovations are among the most important logistics solutions to secure the best outcomes for the company and its customers.

Integrating technology is great, but it must be the right technology to work for your business. Datex states that to maximize profitability, companies need a warehouse management system specifically developed for 3PL operations that provides: real-time visibility; a full spectrum of 3PL billing capabilities; visibility into your inventory status, orders and shipments; and a streamlined process from start to finish. Out of the six solutions provided for warehousing logistics, the common theme surrounds risk prevention, eliminating inefficiencies, capturing business and leveraging technology innovation options.

Take into consideration a dedicated warehousing solution for your company if you’re new to the sector. Why does this matter? By investing in professional management and logistics solutions providers, the company is set up for success without risking initiatives and business deals that could produce disappointing results. Additionally, these providers can assist with creating networking and 3PL relationship opportunities, expanding your business goals and overall vision. Not only do these providers help lay the groundwork for operations, they are the middle man in communicating and assessing 3PL operations.

Another option is where a single distribution center cost is split among several clients. The resources at hand are consistently available among the shared warehouse space that all clients can leverage, as seen with the ODW Logistics solutions model.

Warehouse innovation is on the 2019 horizon and will make a significant mark in the warehousing logistics sector. In an article titled, “Taking a Look into Supply Chain’s Crystal Ball,” drones take the spotlight for warehouse solutions because “50 percent or more of the total cost of the logistics journey is from last-mile delivery” while drones provide a solution from added flexibility.

In 2019, warehousing companies might want to consider the use of unmanned aerial vehicles as an option for delivery. The top two of key differentiators companies consider drivers for change in warehouse usage was the need for lowered transportation costs (at 42.7 percent) while others cited the need for shortened delivery times and (40.5 percent), according to a Zebra Technology survey.

Looking ahead at the changes to come in 2020, Zebra also shows that in 2015, only 55.1 percent of companies were leveraging load optimization and performance monitoring and anticipating its integration by 2020. This number will jump to 61.6 percent, according to the global survey results.

The report goes on to explain that explicit costs and benefits should not be the total focus and only make up a part of the bigger picture. It states that, “Not only do we need to improve the technological advancement of our warehouse, but we need to update our thought process also. When considering RoI on implementing technology, don’t only look at the investment as cost and recovery of cost, but think of how this creates value for your customers, how you improve the productivity of your employees, what impact does it have on your culture and public image, will embracing technology give an advantage over competitors, and so on.”

Zebra’s survey also revealed some interesting insight into the level of difficulty experienced by companies seeking to change the supply-chain process. A total of 32.2 percent noted that it is “somewhat difficult” to introduce changes in 2015. That number is predicted to drop down to 22.1 percent in 2020.

Refreshing your operational approach to warehousing operations should be handled with caution and care. Don’t rush trying to integrate a new technology solution without checking the other boxes first. UPS cautions this practice for next steps and transforming your current business model.

“Most operations were designed based on what worked in the past, and, of course, that can’t necessarily deliver what customers expect today,” says Simon Bhadra, senior manager for the UPS Industrial Distribution customer segment. “There are valid business reasons that customers demand changes from their intermediaries or are bypassing them altogether. Pressure to cut costs, reduce turn times, for example. It’s difficult to make meaningful changes and still be productive and keep customers happy. People say it’s like trying to build an airplane while it’s in the air, and that’s pretty accurate.”

UPS offers three strategic tips to remember when re-evaluating changes and improvements needed for warehouse and distribution efforts. The first is to “Break the Inertia” through an open-minded look into the current state of operations. Just because operations are running up to par does not mean there isn’t room for improvement and efficiencies. Again, they warn to proceed with caution. It’s a fine balance between evaluating what’s not working and applying a new strategy and not going idle.

“Very often we see companies overhaul their operations in response to some kind of catalyst,” says Nancy Pagely, UPS development director. “But making changes without a clear strategy increases the chances of taking a costly wrong turn.”

The second strategy offered focuses on the importance of the customer and providing a sense of “ease, convenience and flexibility.” Bhadra states that, “It’s really critical that operators set aside the knowledge they’ve amassed on customers in order to get a fresh look at what’s going on out there. It takes unconventional thinking and a broader set of collaborators to make smart changes.”

The final piece of advice is taking an honest assessment of your company and don’t let the fear of failure determine your company’s next steps.

“Understanding where you want to be can reduce the number of doors to look behind before making decisions and investments,” explains UPS Customer Solutions consultant Mark Modesti. “As long as you plant a flag and build a dynamic roadmap that lets you adapt as needed, you’ll be ahead of the game.”