In recent years, global developments have provoked a continuous flow of challenges for warehouse operations across the UK. Ecommerce growth, labour shortages, supply chain disruptions, increased safety regulations and the energy crisis are all factors that generate complexities in warehouse logistics management, so how well is our nations warehouses holding out against the constant bombardment of dilemmas? Pretty well actually, according to the insights gained from a recent survey carried out by our team……..
We conducted a survey throughout May, June and July of this year targeting 1000 people of management level within a logistical warehouse operation. 32% of those warehouses serve the ecommerce market, 27% serve the wholesale market and 24% serves the manufacturing market whilst 17% serves other markets. (See figure 1. Warehouse occupancy pie chart)
Figure 1, Warehouse market occupancy chart
Respondents were asked to answer multiple choice questions with the option to provide additional comments so we could unveil the overall stance against modern day pressures within the warehouse, here’s what our findings can reveal……
Key Finding 1 – Smart investment is still a functional tactic.
Overall, Britain’s business investment levels lag behind other major economies according a recent report by the BBC , however our survey reveals that investment remains a functioning tactic across Britain’s warehouse industry. Over a third of our respondents have continued to invest throughout the turbulent past three years and over half anticipate investments in the very near future. (See figure 2, operational investments pie chart)
Figure 2, Warehouse investments pie chart
Evidently the industry recognises that strategic investment is the logical approach to easing the pressures changing demands and regulations. With the right investment in the right areas, the warehouse can stay competitive, remain competent and be ready for what’s next. Let’s take our client who specialise in home heating systems as an example. Their response to heightened demand for more energy efficient home heating systems was to adapt manufacturing to enable the production of more eco-friendly systems. Production escalated and inventory volumes increased, and this was met with an investment into farsighted storage solutions and equipment designed to sustain productivity and make the best use of their new manufacturing and storage spaces.
Key Finding 2 – Customisation priorities haven’t become lost.
28% of those responding to our survey said they have or would consider the services of a third-party logistics provider (3PL) with the larger proportion of 72% keen to keep their logistical operation in-house. Whilst there are many advantages to using 3PL services, control over the logistical operation, quality assurance, data protection and customisation can become limited. These are all things that can take away the ability of the business to foster a customer-first culture which is why many opt for a centralised infrastructure and logistical team; something worth considering for those striving to provide a consistent and positive brand experience. This is the reasoning behind the recent opening of the Moonpig.com warehouse in Tamworth. The online card and gift retailer wanted to take back control of their logistical operation to ensure alignment with their hyper-personalisation strategy. Like Moonpig, 35% of our respondents have or plan to expand their operational footprint through building extensions, occupying additional buildings, or by relocation to a larger space. A larger operational footprint however is the most expensive route to gaining the extra capacity needed to meet new demands. Investing in improvements within the same four walls can be just as viable and much more cost-effective. This is something 63% of our respondents have or plan to achieve through storage systems and equipment upgrades and 45% also said they have of plan to reconfigure their warehouse layout to assist a more streamlined process. (See figure 3, Investment areas).
Figure 3. Areas of investment bar chart
Key Finding 3 – There’s a sustained regard for physical labour.
Investment in staffing and labour is 38% higher than investment in fully automated systems (see figure 3, investment areas) which can minimise labour. Whilst there is a place for technology in warehouse operations, robotic machines lack the capacity to think critically, analyse complex situations and solve problems. Human input makes the greatest contribution to business success owing to the ability to anticipate what’s coming, adapt to changing circumstances, minimise risks, and improve efficiency. Rather than assume the role of humans, automation in the warehouse is supplementary to manual activities and is used in conjunction with human intervention to simplify operational processes. This could be in the form of dynamic storage solutions for example, which can assist vital processes such as stock movement, control, speed and rotation, making the human element less demanding, time consuming or complex. That’s not to say that human error isn’t a factor to be considered, particularly when 56% of our respondents have said that inventory miscounts is a common issue (See figure 4, common issues effecting productivity). Additional comments were much more forthcoming in relation to this topic with “human error is to be expected” being a repetitive statement. This indicates an understanding and accountability for human error in warehouse management, but also the high prioritisation of staff training and wellbeing at 58% (See figure 8, priorities going forward), demonstrates that steps are being taken to minimise the occurrence or impact of human error.
Figure 4. Common issues effecting productivity. bar chart
Key Finding 4 – Strategic resource allocation is giving warehouses the upper hand.
In business, conscious, and informed spending has always been normal practice, so what’s different now? According to the latest report on business investment growth by the Office of National Statistics (ONS), quarter 4 of 2022 showed that business investment levels were still sitting below pre-pandemic levels by 2.2%. The pandemic had a significant impact on global economies which lead to a trail of uncertainties, and businesses began to implement cost-cutting measures to preserve finances.
Having been challenged by demand turbulences, supply chain disruptions and staffing issues, the UK’s warehouse operations have adopted a considerably more tactical approach which has allowed them to maintain a focus on growth and investment. The results of our survey reveal that investments by the larger part are geared towards optimisation and efficiency measures within the existing space of the operations (see figure 3, areas for investment).
By improving space optimisation and efficiency, warehouses can achieve improved control over the most common yet detrimental issues within their operation. In our survey we discovered that insufficient space causes the most strain for over a third of our respondents (see figure 5, areas of strain), however any opportunity to utilise unused vertical space could solve this. Warehouses spaces are being transformed by taller racks in the form of VNA racking systems which not only reach the height of the ceiling, but aisle widths are narrower to make way for more racks. The warehouse mezzanine floor is also a highly effective solution to limited floor space issues. The independent steel structure creates a floor above the ground floor with access features to facilitate how it is used, whether that’s storage, offices, or staff facilities and these include staircases, lifts, and pallet gates. For warehouses without a generous ceiling height, there are numerous deep lane storage solutions such as the pallet live system which offers high density storage, a systematic picking process to support life limited inventory and semi-automation using the natural force of gravity all within a limited floor space.
Figure 5. Issues causing operational strain. Pie chart
Improved space utilisation will also help to prevent traffic jams, overcrowding and bottle-neck situations in the warehouse. Warehouse congestion is a common issue that halts the pace of movement and productivity required for an efficient operation, making it something no warehouse operation wants to experience on a regular basis. By conducting this survey, we have found that for 43% of our respondents storage areas suffer the most congestion (see figure 6. Warehouse Congestion Chart). Space sufficient storage solutions are designed to maximise all available space and gives areas that are unused or poorly utilised a much more viable function.
Figure 6. Warehouse Congestion Chart
Key Finding 5 – The art of readiness manifests in today’s warehouse.
Nothing could have prepared the warehouse operation for the instant and long-lasting instability resulting from the pandemic and Brexit, so when it comes to extra demands going forward, how prepared do our respondents feel their warehouse operations are? Overall, the results indicate that preparedness is something that warehouse management teams are paying close and continuous attention too. For instance, when it comes to seasonal peaks 43% of surveyed warehouses are prepared enough, 34% are well prepared and 23% are still working on strategies to help them become better prepared. 48% feel confident that their warehouse is prepared enough to manage a more diverse product range and 30% say theirs is very prepared for such a change. (See figure 7. Warehouse Readiness)
Figure 7 Readiness bar chart
Key Finding 6: Sustainable practices are being used to assist term viability.
Sustainability has become a business imperative, rather than just an issue concerning corporate social responsibility. By proactively addressing matters on sustainability within the warehouse operation, the business can improve its ability to continually meet customer and stakeholder expectations whilst navigating an evolving business landscape. Sustainability is high on the agenda for our respondents with the matter of energy efficiency being high priority for 49% and a medium priority for 43%. Other sustainability matters taking high priority are improved space utilisation at 61% and staff training and welbeing at 58%. In fact, all matters around sustainability are of major importance to an overwhelming majority of our survey respondents (see figure 8, Sustainability Priorities).
Figure 8 sustainability chart
Conclusion
In conclusion, the result of this survey brings to light the intensity of new and extra demands on our warehouses, but the data also clearly indicates a strengthening response to those additional pressures. When it comes to future growth, 49% are well prepared and 31% say they are prepared enough (see figure 7, warehouse readiness bar chart) which tells us that the UK’s warehouses are certainly striving to keep the pace and deliver what is expected of them.
Furthermore, these survey results underscore the importance of people within logistical warehouse operations as well as tactical investing.
This survey gives us the basis of our understanding of how an ever-changing logistical landscape is received by the industry and there is no doubt that further research would be beneficial, giving us the opportunity to build on these insights as evolvement continues.
Thank You!
We would like to extend our sincere gratitude to our market research participants. Your willingness to share your own opinions and insights have been invaluable to helping is to gain a deeper understanding of the challenges faced by today’s warehouse and how those challenges are being received. Thank you for taking the time to assist our survey!
WSL is always here to help!
If your looking for ways to alleviate your warehouse from the pressures of change, give WSL call because the creativity, knowledge and experience across our Technical Design team means that there is a solution to meet the individual needs of your operation. Our aim is to save your business time, money and space whilst improving operational efficiency and processes that keep with new demands and pressures! Call WSL today on 0113 2045350 or email sales@wslmail.co.uk