E-commerce has changed the way people shop. In a December 2018 report by the National Australia Bank, Australians spent a total of $28.6 billion on online shopping. The market value of e-commerce in the country is expected to grow to $35.2 billion by 2021.
The draw of e-commerce is attributed to convenience. Shoppers have now converted their trips to a brick-and-mortar store to easy, home-based laptop or smartphone shopping. Instead of visiting different stores, people can simply open different online stores, find the same product and decide which website will give them the best deal. They also have the option to have the items shipped to their home at a reasonable cost.
Warehouses are changing, too
E-commerce has changed the way retailers are operating. Increasing competition is challenging businesses to create more attractive offers to convince people to shop with them: free shipping, next-day delivery, freebies for a minimum purchase amount and other promos.
In turn, this has affected a company’s warehouse operations. Once known as large spaces designed to store items to meet the demand created by sales, warehouses are evolving as technological infrastructures serving more challenging demands.
Keeping up with the times
With the changes in business models and consumer behaviour, how are warehouses adapting? Below are the modifications businesses are making to accommodate the changes brought by e-commerce:
- Materials handling
Because of the instant nature of e-commerce, customers are placing orders instantly and are expecting faster shipping times. Some businesses are offering a more diverse selection of products, making the storage and shipping process more challenging.
Although storage bins and commercial pallet racks continue to be effective storage solutions, businesses are developing innovative systems to pick items as quickly as possible. A well-known example is Amazon’s “chaotic” storage system, in which incoming products are placed randomly on any available shelving space and is tracked by an inventory management software that instructs pickers with an optimised route to reach the item.
- Warehouse software
From barcodes to real-time data-streaming, there are numerous inventory management software systems available to track the supply chain from initial supply to shipment. Workers can also use portable devices to access inventory data, track a product in the warehouse and produce sales projections. The software also allows employees to instantly update suppliers and customers about the status of their orders.
- Employee training
Warehouses are more efficient due to better technology and storage procedures, but if employees don’t know how to use the technology or don’t follow protocols, disruptions in the supply chain will occur. With training, workers will have proper knowledge of the technology and equipment, and this will ensure they can keep up with customer demands.
- Size of distribution centres
With the rapid growth of e-commerce, businesses are expanding their warehouses, both in number and size. This is to accommodate a wider variety of products and to transfer products more quickly to the end user.
E-commerce is certainly changing the way business transactions are handled, and it’s expected to develop further. Fortunately, warehouses will remain relevant in the future, as long as physical goods remain in circulation. As technology and consumer expectations evolve, businesses will need to modernise their warehouses. This ensures that they remain competitive within the changing landscape.