Companies can't afford to skimp on their warehouse budgets. Doing so can set organizations up for systemic problems that create added costs and potential losses over time.
The blending of our digital and physical lifestyles is creating a rapid uptick of demand in the warehouse space. E-commerce organizations are diversifying and expanding their warehouse footprints to keep up with new requirements, and manufacturers are refining their processes to accelerate operations and improve efficiency.
As supply chains become even more critical for businesses and operations increase in complexity, companies need their warehouses to stand as bastions for organization and productivity. Cutting corners can have the opposite effect.
Don't Try to Build a Budget Warehouse
Of course, any business needs to have fiscal responsibility when it comes to warehouse spending. But taking a budget approach — investing as little money as possible and taking shortcuts along the way — puts organizations on a path to potential disaster. The potential risks are made evident in a report from The Load Star, which detailed how multiple organizations found themselves running into problems due to excessive cost cutting in the warehouse.
"Companies need their warehouses to stand as bastions for organization and productivity."
The first organization ran into a simple, but extremely problematic, situation. Desires to minimize staff and avoid dedicating resources to the warehouse led to a supply chain that became a disorganized mess. By spending less in warehouse management, the organization ended up with such poor working conditions that it faced stiff fines from regulatory bodies, cutting deeply into any savings that may have been generated by cost-conscious decisions.
In the end, the cost of cutting corners far outweighed the initial perceived savings.
According to the news source, other prominent organizations may not be dealing with fines but have faced significant reputation damage. Highly-publicized media reports have highlighted poor working conditions, safety hazards and similar issues in their warehouses.
The expense of recouping from these public embarrassments will be long-term and costly.
Investing in your warehouse benefits both your organization and your frontline workers.
These stories serve as a warning. Even as the modern warehouse grows in complexity, organizations that fail to invest in the people and technologies that keep them running can set themselves up for long-term damages that undermine the business.
Putting Resources Into the Warehouse
While you won't have to look far to find a horror story or two about bad warehouse environments, the industry is making rapid progress in advancing its technological footprint and becoming more efficient. Transparency Market Research found that global spending on warehouse management systems will rise considerably moving forward, leading to an increase in market value at a compound annual growth rate of 14.1-percent for the 2017-to-2025 period.
What's more, warehouse management solutions and similar advanced technologies often create better work environments for employees. Voice picking technologies offer hands-free mobile data collection, promoting a safer workplace. Analytics solutions, often fueled by integration between data collection tools and enterprise resource planning (ERP) systems, can inform organization decisions and promote safer movement throughout all facilities.
Organizations that make strategic investments in their warehouses can create better and more profitable work environments — and RFgen can help you achieve these goals. We offer a full suite of data collection and integration solutions, empowering businesses to keep up with the demands of the modern warehouse.