Business Case Studies

Is E-commerce Saving the Warehouse Industry?

Warehouses are a crucial aspect of E-commerce. They store products in a secure environment and they’re able to ship them out to consumers or brick and mortar shops. The market has grown tremendously in recent years and this had led to some notable changes in warehouses and the way they run their business.

1.      More demand

With the advent of E-commerce, businesses need warehouse space more than ever. It’s a competitive market where thousands of different companies are all striving towards the same goal – more consumers. To achieve their goals, they need to make use of warehouses and their storage.

In order to be able to meet the demands of consumers, product storage and transport are crucial. E-commerce businesses need to be able to store their goods somewhere after producing them. Not only that, but they have to be prepared to ship them at a moment’s notice. If there’s anything that is important in E-commerce, it’s swift delivery to a consumer’s doorstep.

For this, they require more storage than ever. You have to keep bundles of a product on hold in order to meet demand swiftly. Warehouses are happy to oblige this request, and it’s leading to more business than was previously expected. An increase in business means that they need a larger workforce as well. Countries like the UK are struggling to meet the soaring demand for E-commerce work and they’re hiring as many warehouse workers as possible.

2.      Technological progress

When a business faces rapid expansion, technological advancements are sure to follow. In a market that is as competitive as material and product storage, it’s important to stay one step ahead of the game in order to come out on top. This means making use of every possible technological asset.

Warehouse businesses are looking to robotics to help fill the high demand for a well-trained workforce. Automation is a big step that could significantly influence warehouses and the efficiency of their operations. Right now, E-commerce and storage giants such as Amazon are making use of robots to help them sort and package goods in warehouses.

Robotics are constantly progressing and the expansion of E-commerce is only speeding up the research efforts further. At this point, robots can only do rudimentary tasks, but this is considered more than enough to impact the business significantly. It solves one of the problems that plague many modern warehouses. It seems nearly impossible to hire a good workforce that can match the increased demand for workers in these storage facilities. And robots weren’t always as efficient and profitable as they are now. However, we are seeing more and more automated warehouse functions that have led to more efficient work being done, while also costing managers less.

3.      Physical design

The overall design of warehouses has changed in the past couple of years. Before, you could expect the bare minimum of efficient design of the buildings that make up storage and material handling facilities. The overall layout of warehouses had some notable flaws. Low ceilings and uneven floors made it impossible to carry out orders in a timely manner. Processing orders quickly is crucial when business is good and warehouses are adapting with some changes.

With the rise of E-commerce, the increased demand for storage has led to some improvements in terms of utilizing space. Most notably, the size of warehouses is increasing significantly in order to make way for a large number of orders. Optimization has become more precise. Warehouses are being constructed with much evener flooring and taller ceilings. This allows for quicker processing and orders are being met on time.

4.      Equipment quality

More business means that warehouses require reliable and efficient machinery to help them reach their everyday goals. Equipment that easily breaks down and uses outdated software won’t do a lot of good for the business. Improvements need to be made in order to meet demands more efficiently.

The sheer number of machines being purchased by warehouse businesses has increased significantly. Warehouses are ordering more high-quality forklifts, cranes, and hand trucks than ever before.

More equipment means more maintenance is required to keep it in working condition. Replacing pieces of brand new and high-quality machinery is a very costly endeavour, which is why many storage and transport facilities turn to repairing them first. This has led to more cooperation between them and maintenance businesses. Better deals are made and warehouses get the equipment repairs that they need.

5.      Logistics expansion

E-commerce makes up around ten per cent of all global retail sales. This is a staggeringly large percentage that is only set to increase in the coming years. It’s a growing business that requires more and more strategic planning to keep up with such a large number of orders.

The effects of E-commerce are felt all around the world. Global logistics are changing and improving in order to accommodate a growing E-commerce market. For an online retailer to be successful, they require an efficient supply chain and quick transport methods. The bigger the business gets, the more logistics they need to actually fulfil so many E-commerce orders.

Transportation is strongly affected by online retail businesses and their expansion. The products are no longer delivered to a location such as a physical brick and mortar shop. Instead, it’s the industry standard to bring products directly to the consumer. This requires a transport chain that can handle the sheer number of products that are shipped each day. Warehouses are teaming up with courier delivery services such as FedEx and creating new and profitable business partnerships.

Conclusion

It’s hard to argue that E-commerce doesn’t affect warehouses when it has become one of the leading sources of new projects and business deals. Retailers are scrambling to make use of the largest possible amount of space that they can get their hands on and this means warehouses are in high demand. Improvements are constantly being made to increase efficiency and bring better service to online retailers. It’s clear that the larger the E-commerce market gets, the more warehouses will profit and advance.