Since the dawn of e-commerce, consumers have turned to their personal computers and mobile devices to make convenient purchases.
According to the U.S. Census Bureau, 8.1 percent of all retail sales were made online in 2016, an increase of 0.8 percentage points over 2015. Additionally, between the second quarters of 2015 and 2016, the percentage of e-commerce sales compared to all retail transactions increased 16 percent. This jump marks the highest year-over-year increase in two years, Business Insider reported.
As online shopping continues to influence the retail industry, facility managers are beginning to rethink old practices that may no longer be working. For example, where warehouses were once primarily used for storage, today’s stores are relying on these versatile spaces for picking and packing as well. That’s why onboarding new equipment and asset management solutions is necessary to stay competitive in the new e-commerce landscape – but these changes come with obstacles of their own.
Maintaining an ever-growing facility or network of facilities is challenging without someone dedicated solely to the maintenance, uptime and productivity of your machines and operations. So how is your warehouse evolving?
E-commerce drives retailer investments
Given the shift in warehouse solutions requirements, retailers have begun making two types of major investments:
1. More warehouse space
Customers purchasing items online rather than in person means there’s a greater need for conveniently located square footage, Material Handling & Logistics explained. To attest to this fact, warehouse rental prices are expected to increase 10 percent by 2018.
2. Newer equipment
Many warehouse managers are finding that older machines and supplies weren’t built to efficiently handle frequent and smaller, more personalized orders, Modern Materials Handling reported.
“A lot of companies have been caught off guard by the growth in e-commerce,” Ian Hobkirk, founder and managing director of Commonwealth Supply Chain Advisors, told MMH.
Hobkirk recounted one warehouse he visited that was employing small carts to pick orders and push them across the warehouse on a regular basis.
“If you can get a little bigger cart that can accommodate a few totes or boxes at time, you can drive up your pick rates, instead of having to make 20 trips through the warehouse to pick 20 orders,” he explained.
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In its annual survey of warehouse and distribution center equipment, Peerless Research Group found that 35 percent of respondents said they intend on making equipment and technologies investments this year. Of those, some of the most common planned purchases are:
- Materials handling systems (65 percent).
- Fork lifts and lift trucks (59 percent).
- Conveyors and sortation equipment (39 percent).
New investments increase need for maintenance
Retailers are quickly seeing the importance of total efficiency and quick order fulfillment. Everything in an e-commerce distribution center must run smoothly to give the consumer quality service. As such, it’s paramount that everything in a warehouse, whether it’s newly built or slowly being upgraded to meet today’s demands, is in working order.
Unplanned downtime due to failing equipment can hinder the flow of distribution, drive up production costs and ultimately disrupt buyer expectations. Ensuring that everything in a distribution center or warehouse is in working condition – be it the conveyer mechanism, the aerial lifts or the loading dock doors – is critical.
When bringing in new machines and tools – and lots of them – most facility managers know the importance of understanding each new additions’ maintenance and servicing requirements. This likely explains why, while 67 percent of respondents to Peerless’ survey said they would invest in equipment upgrades over the next year and a half, another 37 percent said they will focus on maintenance services – up from the 33 percent who said the same thing in 2016.
This theme is closely related to warehouse operators’ increased focus on cost containment; three-fourths of respondents said this would be a key issue in the coming years.
Facility managers working to improve and upgrade their warehouses can enlist experts who can accurately determine when and how to repair, replace or tune up equipment. This full-service asset management strategy can greatly improve operations and cut down on maintenance, replacement and even safety liability expenses. By working with a partner with more than 20 years of experience identifying operations’ short- and long-term facility maintenance needs, managers can focus on keeping their warehouses running smoothly and efficiently. To learn more about these options, contact Miner Corp today.