Can warehousing trends impact trucking?

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Trucking and warehousing are industries inextricably linked within the freight business, as trucking hauls the goods that warehouses stores.

So Motorola’s recent survey of warehouse information technology (IT) and operational professionals in the logistics, manufacturing, retail and wholesale market segments who work for firms that have at least $15 million in annual revenues coughed up some trend markers that truckers should think about.

First, those warehouse IT and operations decision-makers cited a growing need to increase worker productivity plus automate and streamline processes – but not just to cut costs.

Indeed, the pace of supply chain re-evaluation and optimization is quickening as nearly two-thirds (67%) of those polled by Motorola claimed that they are either constantly or annually re-evaluating their supply chain networks – and, in many cases, that means expanding their warehouse operations in order to take advantage of “market opportunities,” they claimed.

Here are some takeaways trucking should think on. According to Motorola’s poll, the most commonly cited reasons for the expansion of storage and distribution networks include a mix of cost-savings and revenue-growth initiatives such as:

  • Lower transportation costs (36%)
  • Shorter delivery times (35%)
  • New suppliers and trading partner locations (31%)
  • And “heightened” omni-channel pressures (11%)

I would think the twin goals of lowering transportation costs while shrinking delivery times can only mean shortening up truck routes – and whether that’s a good or bad thing depends on the carrier.

Here are some other trends worth watching:

  • More than one-quarter (26%) of respondents to Motorola’s survey reported that company management views warehouses and distribution centers as an asset that can drive growth for the business.
  • By 2018, more than one-third of respondents (35%) plan to increase the number of warehouses and distribution centers they operate, representing a 71% increase from current expansion plans in action today.
  • During the next five years, approximately two-thirds (66%) of respondents plan to increase automate processes by equipping staff with new technology solutions.
  • As warehouses move to reduce order fulfillment costs and increase worker efficiency and productivity, the picking and replenishment solutions of the next five years will shift more toward true “multimodal” operation, with a 142% increase in the integration of voice-directed and screen-directed picking on flexible mobile devices along with a 113% increase for voice-, scan- and keyed-response workflows.
  • Warehouse professionals expect a significant shift away from pen and paper-based processes (a 71% decrease) to handheld mobile computers and tablets (100% increase) for so-called “cycle counting” and inventory validation work by 2018.

The upshot of all of this, according to Mark Wheeler, director of warehouse solutions for Motorola, is that warehousing is no longer being seen as an “afterthought” or “necessary evil” for businesses – indeed, much like trucking, it’s increasingly seen as a vital component capable of helping (or hurting) the bottom line.

“Warehousing and distribution have not traditionally been the most celebrated functions within leading businesses across manufacturing, retail and wholesale industries,” he said.

“But this survey revealed that these functions are playing a more important role as businesses in these industries face new pressures to cut costs to enhance profitability and free up capital as well as drive competitive differentiation and business growth,” Wheeler noted.

Thus it will be worth keeping an eye on warehousing trends to see how they’ll affect trucking down the road.

Discuss this Blog Entry 1

on Aug 19, 2013

As I read this, I was thinkin'...How many jobs are going to be lost? Lots of code words for reducing the workforce in the "trends".

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