Automation remedies for understaffing issues in retail

by | Jul 31, 2019

Now that 2019 holiday planning has begun in earnest, retailers and suppliers alike are scrambling to address the worker shortage that is plaguing the industry. With unemployment at a nearly 50-year low, finding workers is more challenging this year than ever.

Each year, the search for temporary holiday help starts around October, as retailers, suppliers, distribution centers, warehouses, 3PLs and carrier companies all try to fill empty roles in order to keep up with the holiday rush.

When retail stores and fulfillment centers are short-staffed, it can cause decreases in service quality, customer satisfaction and total sales. Even a one to two percent dip in holiday sales can mean the loss of millions of dollars for some of the largest retailers. All for the want of extra employees for eight weeks at the end of the year.

For online retailers, staff shortages look like inventory miscounts, unexpected outages and missed shipping deadlines, which often have to be comped and/or replaced. For warehouses and distribution centers, staff shortages look like overtime, longer loading and unloading times, slower picking and fulfillment times and angry customers.

This is where automation of certain job functions and responsibilities can make a big difference. And automation doesn’t even necessarily mean job loss or worker cuts, either. For example, the Boxed company added robots to their workforce and ended up needing more human workers as they built more warehouses to handle the increased workload.

Painting a picture with automation

Imagine one person being able to check in and do an inventory count on an entire truckload in a fraction of the time that it could take an entire team to do the same work. For our client Cabela’s, it used to take two workers working full time for two days to unload a truck if there was ammunition on the load because it’s a lot of tiny boxes and parts. Now it takes one worker half a day to do the same task. This was accomplished using the Advanced Ship Notification sent via EDI telling them ahead of time what’s on the incoming load, combined with RFID/barcode scanners used for inventory receiving. Instead of opening each box on every pallet and counting everything by hand, a simple scan of the barcode can reveal everything in the box, on the pallet, or even what’s included in the entire load, and add the items into inventory to boot.

Envision how many things could change if your inventory software could automatically order your best-selling items with enough time before you run out, rather than you discovering that you’re out once the last product has been sold. Combining your ERP systems with analytics and EDI means you can receive alerts when products are running low, or you can let the system automatically reorder your frequently purchased items before they ever run out.

Picture a world where your EDI solution could assist with automation of your three- and four-way match reconciliation process for paying invoices. EDI can make it easier and faster to automatically compare purchase orders and invoices to other documentation, such as purchase order acknowledgements, ASNs or warehouse receiving documents. With such automation enabled, all the relevant documents are compared to make sure they match and send the invoice into queue for payment. The only time human intervention would be necessary is when something doesn’t match between the documents. This could potentially reduce your accounts payable staffing requirements by up to 75 percent and allow you to process more transactions in less time.

EDI automation also means you can automate your ordering process, which cuts down on manual entry, and let you reassign your staff to other departments. We’ve seen retail brands with buying departments of 12 to 14 people doing manual order entry trim their departments down to two to three people, thanks to automated ordering and transaction matching.

Visualize being able to handle more shipping out of your retail locations by fulfilling e-commerce orders from the store closest to your customer, rather than a centralized warehouse. Inventory management software can help you automatically parse out orders to a retail store nearest the customer while still keeping track of your system’s total inventory count.

And imagine being able to speed up warehouse inventory counts and keep more accurate warehouse inventory counts. This not only helps you avoid shortages, it helps reduce the number of workers needed to keep track of inventory. Rather than tying up staff time to count products, they’re scanning products in and out as they unload trucks or pick orders, and the software is keeping track of everything. This helps warehouse managers, retail buyers, and even e-commerce managers know how much inventory is available without doing manual counts, and keeps more workers handling fulfillment and loading/unloading.

EDI automation, warehouse automation and even new processes like in-store fulfillment can help make it seem as if you’ve expanded your staff and capabilities without actually adding new staff members. You can reduce the need for human capital, while increasing your overall efficiency.

Now is the time to start exploring new technologies and processes as we get ready for the 2019 holiday shopping season. To learn more about EDI automation, speak to one of our solution experts for a free demo.

Tony Thrasher

Group Product Manager at SPS Commerce
As an expert in retail fulfillment, Tony offers a unique viewpoint on using the latest retail technologies, including the SPS Commerce Retail Network, RFID and more to drive innovation and growth. At SPS, he is responsible for using graph-based architecture to drive meaningful insights and expand the value of the SPS Commerce Platform to customers and partners.
Tony Thrasher