As COVID-19 continues to reshape the supply chain, we're looking ahead to the emerging trends in warehousing you need to be aware of to ensure your organization thrives in 2021.
Flexible, scalable warehouse space, forward-deployed inventory, and supply chain resiliency are among the leading trends that will help companies meet new consumers' expectations while supporting health protocols.
Five Emerging Trends In Warehousing To Prepare For In 2021
Bring Your Supply Chain Closer To Your Customer
In planning for more of the same in 2021, customers are seeking space to meet shifting consumer behavior due to COVID-19. In 2020, companies were laser-focused on meeting their immediate needs in the current environment, primarily ensuring they were able to deliver materials to the end-user on time. For 2021, the focus shifts to mitigating risk in supply chains that endured significant disruption over the past several months.
In some cases, bringing the shipper's supply chain closer to the end-user, such as reshoring and nearshoring, has become a smart fix. GlobalTranz works with existing and new customers to identify the most efficient location and use for their warehouses.
Transform The Warehouse Network
The growth of e-commerce in both B2C and B2B markets has strained many companies' fulfillment systems. In 2021, e-commerce is expected to continue growing, with B2B e-commerce sales expected to increase by 17.5% per year through 2027. Companies are trying to push more direct-to-end-user shipments through fulfillment networks that weren't designed for it.
Over the last six months, the boom in e-commerce and residential deliveries has accelerated the need to expand warehouse and fulfillment space closer to population centers to meet faster delivery windows. In the past, low-cost warehousing space was the priority for most companies. Centralizing inventory in massive regional DCs for store replenishment was a successful strategy. But the game has changed.
Fast forward to the last few years, and more customers have focused on optimizing their geographic location with end-users in mind. This strategy allows shippers to meet customer expectations for fast delivery without the cost of priority shipping on thousands or millions of individual packages. It supplements or replaces processes such as zone skipping for parcel and LTL moves.
We think many companies will invest in warehouse space closer to their customers, even if it means an increased cost to serve.
Plan For Supply Chain Resiliency
Resiliency is all about how you bounce back after being stretched nearly to the breaking point. Supply chain resiliency will be a significant driver in 2021 as companies continue to face unprecedented disruptions due to COVID-19's impact on consumer behavior, capacity, and the economy.
Supply chain optimization software will be one of the secrets successful companies adopt to provide deeper visibility across their supply chain. If a company can integrate and view all their data in one place through a warehouse management system, it creates more visibility to adapt and think holistically about their needs. Organizations that invest in digital tools to provide data and insight that allows for customization around supply chain operations will pay off in enhanced resiliency in a post-COVID-19 world.
Revise HR strategies
The warehouse of 2021 and beyond will be as much of a technology center as an inventory center. To support a shift toward warehouse technology, Human Resources Departments will need to adapt their warehouse hiring processes.
Companies will require employees with a higher education level in warehouse operations, including IT specialists and engineers with robotics backgrounds. This is motivated by the increasing amount of data collection and automation deployed within warehouses and fulfillment centers to augment employees' work. Simultaneously, with the increase in talent with a background in data science and robotics, there will be a need for supply chain professionals with the oversight and expertise to manage overall operational efficiency and connect the tech to the larger supply chain picture.
Invest In Digital Transformation
Digital transformation across the supply chain will heighten in response to the disruption we've witnessed in recent months. We expect to see more rapid adoption of new technologies, such as digital warehouse management systems, that are part of a single solution or platform that allows customers to see across their entire supply chain. With more real-time insights and data to inform decisions, companies can factor in their sales projections and map out the flow of goods from manufacturing facility to end-user more efficiently. Through digital transformation, organizations will have a better idea of their inventory levels and location. Additionally, digitization will help foster collaboration and improve visibility, which will help your supply chain become more flexible and resilient.
Understanding and employing the top emerging trends in warehousing can position shippers for success in 2021. As you develop your logistics strategy, look for collaborative, strategic partners like GlobalTranz who have the experience and technology to prepare for any disruption your organization may face.
To make the most of the top emerging trends in warehousing, contact GlobalTranz today.