The Impact Of E-Commerce On The Warehousing Industry
E-commerce has had an undeniable impact on the shopping habits of consumers in today’s economy. People who never shopped online before have discovered its incredible ease and how it can benefit them in their daily life. People who used to buy one or two things online have now converted nearly all of their former shopping trips to convenient, home-based laptop sessions increasing online purchases. Adapting to these new trends, the distribution companies are finding that change is necessary.
Several components of the industry have been affected in an interesting manner, thanks to e-commerce. Specifically, let’s take a look at how, in order to accommodate e-commerce, the warehousing industry is changing.
New Logistics Technologies and the Use of Robotics
The traditional warehousing model is relatively incapable of supporting the unpredictable buying patterns and higher expectations of today’s online shoppers. So in order to increase overall productivity, accuracy, and efficiency any number of distribution centers are turning to robotics and new improved technology.
Warehouses must be more flexible in order to meet the needs of IT companies that are expanding their management systems and solutions in light of increasingly complex direct shipping to consumers and the geographical considerations that entails. More and more facilities are increasingly relying on an automation system that has become a vital tool in warehousing operations.
Different Consumer Expectations and Behavior
It has been determined that consumers who shop at retail stores behave differently than consumers who shop online. Consumers who buy online tend to return items at a higher rate than those who shop in stores. In fact, while only 10% of store bought items are returned, an average of 22% of online purchases are returned.
This trend may have something to do with the e-commerce consumer’s higher expectations. Online buyers expect minimal delivery fees, easy returns, and quick fulfillment thanks to Amazon and other e-commerce giants. What this means for warehouses is that they not only feel pressured to lower their costs and improve delivery but they must be prepared to accommodate increased returns.
Changes in Volumes That Are Less Predictable
Sales patterns were more or less predictable and, aside from holiday rushes, and tended to remain relatively stable throughout the year. Thanks to this predictability, warehouses could usually plan on any advance adaptations necessary. But unpredictable buying patterns have sprung up with consumers getting goods shipped directly to their homes. Rapid adaptations by distribution centers are a necessity.
New kinds of skills, which means new levels of training, will be required for employees and fresh technologies and strategies must be developed in order for warehouses to support the changing system.
Shipping Individual Items versus Shipping from Pallets
Businesses used to be able to ship products to other businesses on flats. With retail stores losing popularity, shipping is being done directly to the home of the consumer. This makes for unpredictable shipping patterns. Now, not only do warehouses need to reevaluate shipping and picking technologies, materials, and their process but their method of handling inventory and storage as well.
What used to make logistical hubs prime locations is being increasingly affected by the surge in online shopping. Again, consumers want their goods shipped in 1 to 2 days because that’s what they have come to expect from e-commerce sites. This makes it more important for warehouse facilities to be located in closer proximity to large cities.
By the year 2021, a 40% increase in e-commerce has been projected by companies in-the-know. Warehouses should, in the coming years, be prepared to adapt shopping patterns and new expectations in order to tackle the latest changes of a continually rising e-commerce. Being able to rely on a dependable company that understands the challenges of warehousing and how it is changing, thanks to e-commerce, is a major building block of a good business.