Check Call: International warehouse study finds challenges and progress

July 9, 2024

They say you should plan your next trip before the last one ends. While the Future of Supply Chain ended a month ago, we’ve got just the thing for that post-trip hangover: discounts on F3 tickets! Subscribers to Check Call have a special discount code for F3 registration. This is going to be one of the best deals on F3 tickets. Use the code CheckCallF324 or go to this link, and the discount will be applied. We all know the party is better in Chattanooga anyway. This is not one to miss.

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Aurora Insights recently released a report titled “Warehousing 2024: exclusive analysis of UK and international warehousing.” It might seem weird to care about warehousing in the United Kingdom, but the international component is crucial as the global supply chain and nearshoring efforts take off, and it’s something that eventually affects everyone.

Space, improper management and lack of efficiency lead the pack in issues across all warehouses. The lack of efficiency ranges from poor picking practices, routing systems and inventory management all the way down to how quickly orders can be processed.

The study identified five key challenges in the sample of 54 projects and 93 companies.

Over half of the sample reported challenges pertaining to low sustainability, particularly with respect to high emissions and high waste.

Around 45% of the sample reported low visibility to be a recurring challenge encountered in their operations. Primarily, warehouses struggled with being able to locate goods at any point along the supply chain and divert or transport them to wherever they needed to go as quickly and efficiently as possible.

Just under 40% reported issues because of no or poor data. This meant companies were unable to identify challenges, both occurring and potential, and rectify them.

A third of the sample struggled with inefficiency in their processes. This can lead to poor or at least nonoptimal operations, decreasing the speed at which goods can be moved around. This in turn can increase costs and decrease profit.

Finally, around 30% of the sample struggled with time-consuming processes. Again, this slows productivity, raising costs and lowering profit.

When companies addressed some of these challenges, the study found that “Two thirds of the sample increased their efficiency, while just over 60% improved their sustainability. Over half improved the quality and quantity of data collected, approximately 52% improved their supply chain visibility, and just under half experienced improved customer satisfaction.”

There is no good place to start, but doing one thing and making small improvements is better than nothing. Warehouses running more efficiently and effectively can reduce wasted space and potentially increased costs if an extra facility needs to be procured.

SONAR Tickers: OTVI.HOU, OTRI.HOU

Market Check. The National Oceanic and Atmospheric Administration has predicted a higher-than-normal hurricane season this year, and so far that prediction has delivered. Hurricane Beryl is the earliest on record to make landfall. In its wake, Houston has been left in a rough spot. Ports are closed, power is fickle and residents are using the Whataburger app to know how many areas are without power. All of that plus heavy flooding doesn’t make Houston the place to be for trucks right now.

In preparation for the hurricane making landfall, carriers started rejecting loads at a higher level and shippers never really bounced back from the holiday slowdown. Outbound tender rejections in Houston are staying at 6.9% and trending downward. For most of this week, capacity will remain fickle in Houston as the recovery from the hurricane mixes with the post-holiday cleanup.

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Who’s with whom

Werner is back fighting the fight on unions. Last year there were 25 workers at Werner ECM units at three New Jersey facilities who voted to be organized by the United Food and Commercial Workers union. The vote to unionize was a success, but there has yet to be an official contract as negotiations are still taking place.

The newest battle for Werner comes from its Erie, Pennsylvania, facility. There are 16 employees at the ECM facility who are looking to unionize, but this group is aiming to be represented by the Teamsters instead of the UFCW. This battle is a little more messy as there are complaints against Werner to the National Labor Relations Board and alleged termination of employees for organizing.

This biggest obstacle Werner is up against lies in the Cemex decision. “That NLRB decision from last year is seen as giving the agency power to order union recognition under certain circumstances even if a unionization vote failed with the rank and file.”

John Kingston’s article quotes Aaron Vance, employment attorney with Barnes & Thornburgh: “Prior to Cemex, employers could simply refuse to accept a demand for recognition even with evidence of a majority support of a union, and upon doing so, no further action was required by the employer. Moreover, the employer’s refusal to recognize the union would not violate the National Labor Relations Act.”