I was recently on a site visit at a fulfillment center for a branded retail apparel company and was shocked to see the pain associated with Black Friday! We all all about the peak and building the automated solution for the Easter Sunday mass, but until you see the pain it’s hard to fathom.
I drove to the warehouse and upon arrival saw a line of approximately 50 people standing outside in 25 degree weather waiting to get in the building. I could not find parking in the traditional lot so had to park on the far side of the building in the grass and walk back up to the front. Upon arrival to the front door I was greeted by an employee that recognized I was there for a meeting and informed me to skip the line and check-in at security. Inside there was another 100+ people waiting to sign in and all of these people were just there for temporary labor to support the peak.
This company brings in over 150 temporary laborers per shift to support peak and unfortunately even after providing a number of perks they typically only last 3 days before having to replace them with additional temporary employees. To entice these people to work the holiday period the company gives each of them a turkey to take home for Thanksgiving, a pay check, training and a temperature controlled facility, but it’s still not enough and they can’t get enough employees to deal with the peak demand.
So you likely are thinking this facility is extremely manual and that’s the challenge, but that is not the case! They have multiple sortation solutions, conveyor, AS/RS mini-load storage and pick modules, but still have to bring in over 600 temporary employees to have a chance to ship within 24 hours of the order being placed.
So what’s the answer?
1) You can try and change the customer expectations by providing a discount if they are ok with getting the order picked later and allowing you to increase the batch size to reduce the cost of picking, but most customers will not accept this.
2) You can build automation for the peak, but then 90% of the time the investment is not fully utilized and in traditional automation solutions next year’s peak may be larger requiring another large investment.
3) Robots as a service. Next generation automation is currently being deployed here, which will allow robotics to augment traditional pickers and reduce the temporary labor staff requirement from 600 to 150 employees or less. At the end of the peak some of these robots will be removed and then used at other facilities that are just adapting automation to support traditional business requirements.
Have you considered implementing automation just for a peak period?
It is truly eye opening to tour a facility during this time of year and see the level of effort that goes into being able to achieve customer expectations!