By Alex Mills, Sales & Marketing Director at ProSKU
The majority of online retailers selling products whose sales peak at Christmas time are hitting their busiest commercial trading period. It’s the time of year for many such businesses when, hopefully, the advanced preparation and planning done beforehand pays off. The systems and procedures put in place to handle significantly increased seasonal volumes should mean that even with temporary hired-in resource, things will still go relatively smoothly. Or will they?
Most online resellers can cite at least one experience of underestimating the impact of the festive season. As it’s not something they generally want to repeat, a common practice is to hire in some agency staff at a premium to help with the increased workload. On Christmas Eve, all being well, they can sit back and breathe a sigh of relief, knowing they’ve just about coped, once again.
And it’s easy to see why, with the extra sales and profits potentially generated at Christmas, the short-term cost of the labour involved is easily justified. However, cost aside, using temporary labour at a time like this does bring with it a number of problems. Chiefly unfamiliarity, because there’s a minimum level of training needed for temporary staff to be able to function, even at a basic level.
Even when trained they’re still well short of the experience and knowledge of your regular staff. They don’t know the environment, the product or the processes. So inevitably they’ll be less productive, absorb more supervisor time, and generate more errors which require correction and incur time and cost. They may also cost you a few lost sales, and some unwanted customer issues.
So, is there a solution to this? Is it possible to minimise the requirement for additional labour in the Christmas period and still meet your order fulfilment targets? Well yes, there is, and it seems odd that many companies would rather have a heavy financial outlay on extra staff at Christmas than deploy an IT system that could lessen or potentially even eradicate the need for those staff.
It’s not unknown for companies selling products with a strong seasonal appeal, for example toys, to increase their annual wage bill by 50% in just the two months prior to Christmas. While some extra cost is always likely to be involved there are a number of ways in which deploying the right IT system, a WMS in particular, can help. This would not only reduce seasonal expense, but also minimise cost and boost productivity all year round.
To paraphrase a well-known expression: “A WMS is not just for Christmas.” Not only will it help you manage workload and reduce excess labour costs at Christmas, it will provide joy all year round! A WMS is designed to manage your physical stock with optimum efficiency by using simple, efficient and secure processes for all activities from receipt through to despatch. As these are largely system driven, this reduces reliance on staff knowledge, a particular benefit when using temporary labour.
A WMS for example will ensure that all the information you need about received goods is correctly recorded. It will then instruct putaway to a system generated location, removing the need for staff to know where product is normally stored. When you receive an order, it will direct your pickers to the correct location to find the stock, taking into account any date or FIFO rotation. It will then manage your pack and despatch process, ensuring you despatch the right product and quantity.
The benefits of using a WMS – accuracy, efficiency, productivity and discipline are magnified when you use the system in real time with a dedicated App for handheld devices. This allows everything you do to be recorded in real time, making your stock data accurate to the minute. It also means you can build in as much barcode verification as you need, trapping errors immediately and ensuring the accuracy of everything you receive, pick and despatch.
Having a WMS gives you a solid foundation of operational ‘best practice’ which can deliver even greater benefits at your seasonal peak. When you need extra staff, equipping them with an inexpensive handheld device reduces their training needs, so they can be effective almost immediately. As their work is system-directed and verified by real time scanning, errors and supervisor intervention are cut to a minimum, allowing permanent staff to focus on their own roles.
To save the punchline to the end, the best part of this is the cost. A WMS like ProSKU which is available at a competitive monthly rental needs little cost justification for the normal benefits it can provide. It will make your operation lean, efficient and competitive all year long. But when you consider the high (and recurring) cost of seasonal labour and the degree to which a WMS could lessen this, it becomes positively insignificant.