Successful retailers are designed to deliver excellence. But what happens when labor is scarce and volumes are unpredictable? Craig Whitehouse, Managing Director at an independent systems integrator, Invar groupoffers a survivor’s guide to peak season.
Depending on the industry, seasonal peaks are popping up to the rhythm of UK Prime Ministers – from Diwali, Halloween/Bonfire Night to Black Friday/Cyber Monday to Valentine’s Day, Chinese New Year and Easter. The front end of this is rightly referred to as the “Golden Quarter” – that’s where most retailers make most of their sales. But the culmination of highlights is always Christmas – never easy and this year probably more complex and unpredictable than usual.
With the UK and the global economy heading into recession, it is certain that Christmas sales will be more subdued in terms of volume this year. Does that make tackling the peak of the season easier? But on the contrary.
Many consumers, exposed to inflation, unsure of future income and potentially anticipating emergency pricing by retailers, will delay their purchase until the last minute, making the “peak” even worse. Meanwhile, retailers and distributors that have controlled or reduced their headcount — or have been unable to recruit staff even for the “normal” level of retailing — will have fewer places to call for overtime or extra shifts. And more than ever, a lost sale because goods are not immediately available is a lost sale ultimately.
This applies to all channels. The share of e-commerce in sales has declined somewhat, but at around 30% it is still well above the pre-pandemic level. However, stocking physical stores at Christmas could be even more important – many consumers won’t be shopping for their Christmas events: ‘going shopping’ can be the Christmas treat. In addition, a further peak in returns is to be expected – not because the goods are somehow “wrong”, but because many consumers would rather have the cash value of the well-intentioned “gift”.
With so much uncertainty, it may seem counterintuitive to claim that investing in automation is a key part of the answer. Certainly, until a few years ago, “automation” was synonymous with “mechanization with some intelligence” and typically involved serious civil and mechanical engineering viable only for companies with high and predictable throughput. However, things have changed significantly. Intelligent automation is now both highly flexible and scalable, and much easier to install – no complex engineering is required.
A far cry from the rigid, fixed conveyor systems and heavily interlocked solutions of the recent past, autonomous mobile robots (AMRs) can efficiently navigate routes even when their geography has changed. And increasingly, they can work safely alongside human colleagues rather than being fenced off. Established techniques such as pick-to-light or pick-to-voice, coupled with appropriate automation, can provide workers with far more rewarding and error-free conditions – improving employee retention and potentially enabling wage increases.
Efficient use of these new resources depends on sophisticated, flexible warehouse management systems (WMS) that can be easily adapted to individual applications and easy integration with best-of-breed hardware. Adaptability is key, for example picking protocols that can be integrated and implemented centrally and “on the fly” – without having to reprogram each machine individually.
In addition, these solutions are easily scalable in most cases. Adding or removing AMRs and mobile shelving units is a fairly simple process, with the WMS being similarly adaptable. And increasingly, these items are being rented rather than purchased outright, giving companies relatively risk-free ways to meet peak demand.
But perhaps most importantly, automation isn’t “just for Christmas.” The point is that it can be scaled and adjusted to provide year-round benefits, both peak and off-season. Intelligently designed and flexibly integrated warehouse automation can bring a multitude of savings to an organization challenged by labor shortages and the need to meet peak volumes cost-effectively. Smart use of automation can enable a business not just to survive, but to thrive.