Smart Companies Are Preparing Now for Peak Holiday Shopping and Shipping
The increasingly disruptive labor landscape will continue to bedevil warehouse operators as we approach the peak season of 2024.
2023 brought significant challenges, but warehouse labor shortages continue this year. ECommerce has grown 8-10% globally, and Peak 2024 shopping dates will be 5% higher than last year. This means your warehouse will need to scale labor up or down with changing demand.
Labor on demand services, also known as flexible or adaptable labor, offer a solution. Such labor services offer advantages in operations, risk mitigation and technology leverage.
Operational Advantages of Flexible Labor
Managing warehouse labor is a tough job. Attracting and retaining full-time workers can be impossible. Temp agencies rarely send fully trained warehouse workers. That hampers warehouse productivity.
All of that makes choosing the right labor services company important but difficult. Flexible labor offers the ultimate in scalability, quality and efficiency.
Fulfillment and distribution centers need to scale their labor force quickly during demand spikes. Flexible labor adds scalability without the expense of full-time workers.
But scalability matters little if your workers cannot handle order picking, returns, inventory management or work safely.
Modern warehouses pose safety problems. Workers must integrate with forklifts, automated guided vehicles, material handling equipment and more. Slips, trips and falls are common. Overexertion leads to musculoskeletal disorders.
Don’t rely on warm bodies. You need a partner who can provide vetted, trained, and supervised professionals who fit your company culture. This includes background checks, drug screens and customized training to meet your specific needs.
Best-in-class labor on demand services, like Task4Pros, use advanced methodology and rating models. You get full KPI dashboards, fill rates at 99% and turnover rates less than 20%. Those figures are key to driving profits and efficiency in your warehouse operations.
Efficiency will become even more important this year. Analysts expect eCommerce returns to rise this year. That means your Peak 2024 labor costs will continue into January, maybe even February, of 2025.
Mitigating Risks and Leveraging Technology
I’ve written before about this year’s revamped federal independent contractor rules. The regulations increase the risks of misclassifying workers as independent contractors.
You want labor on demand services that offer their workers W2 employment status. That status significantly reduces the risk of expensive worker misclassification and co-employment lawsuits.
The best partners also will use technology. “There’s an app for that” debuted as a marketing slogan years ago. It took a while, but the best labor on demand services leverage app-based technology.
Apps provide an “Uber-like” solution for your labor needs:
- Modern, real-time communication
- Visibility into task status
- Easy data extraction for reporting and analysis
That means you can, with a tap, check out those impressive performance metrics listed above.
The choice is yours. You can stick with the 70%-80% fill rate and 48%-52% fill rate of typical temp agencies.
I would recommend upgrades for improved warehouse operations.
While It’s Warm, Find Adaptable Labor for the Holidays
As we hurtle toward Peak 2024 and into 2025, supply chain leaders need to rethink how they approach the labor market.
The risks of using independent contractors in distribution, fulfillment and reverse logistics operations are growing. Even under the old rules, FedEx has paid hundreds of millions of dollars to settle legal actions. Flowers Foods settled for $55 million. I could list more, but you get the idea.
Still, you need the operational advantages of adaptable labor. But you need labor on demand that delivers trained workers, not people you have to teach.
I’d love to hear how you’re planning to deal with Peak 2024. The weather may be warm. We’re not even in autumn. But your warehouse operations need to connect with the right labor services partner now.
The eCommerce landscape continues changing, and labor challenges persist. Get ahead of holiday disruptions, and make sure you have the workforce necessary to serve your customers for Peak 2024 and beyond.
Related Reading
- New Independent Contractor Rules: What You Need to Know
- Taylor Swift, Peak 2024 and Land Use – Yes, They All Connect
- The Uberization of Labor Services
- Herd of Black Swans Disrupts 2024 and Beyond
Jim Tompkins, Chairman of Tompkins Ventures, is an international authority on designing and implementing end-to-end supply chains. Over five decades, he has designed countless industrial facilities and supply chain solutions, enhancing the growth of numerous companies. He previously built Tompkins International from a backyard startup into an international consulting and implementation firm. Jim earned his B.S., M.S. and Ph.D. in Industrial Engineering from Purdue University.
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