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nGROUP Performance Blog

Peak Season Labor Management: How Amazon & Walmart Take on “The Ramp”

Posted by Ryan Cates on Aug 30, 2019 4:26:00 PM

Peak season is upon us, and that means that retailers across the country are ramping up their operations in preparation for higher customer demand. In recent years, managing peak season has become more challenging. With the rise of eCommerce, there’s an increased volume of orders, which creates space, staffing, and infrastructure issues. On top of that, customers expect short shipping windows — such as next-day or two-day deliveries — and the labor market is typically tighter during peak season because all retailers compete for the same talent.

Before accepting his position as nGROUP’s COO, Bob Duron served as a supply chain executive for Amazon, Walmart, DHL, and The Gap. In this webinar, he shares some of his strategies on how to best prepare for peak season.

photo-bobdBob discusses the need to ramp up for peak season on time. If you ramp up too early, you can over-hire labor and increase labor spend where the production schedule has not ramped up. If you wait too long, you can experience a lag in production and have a difficult time finding the labor in short notice and run into challenges you can’t resolve. Instead, check all of your systems to make sure they’re ready for high-volume production, and stress-test your equipment.

It would be best if you also determined how many people you’ll need and hire the appropriate amount to fill out your workforce. You can employ multiple strategies to get more labor:

  • Work with a staffing agency to hire temporary workers.
  • Task your in-house team with recruiting seasonal workers.
  • Work with a managed service provider — or MSP.
  • Have your full-time employees do more overtime.
  • Or a combination of the above.

Reduce costs

Determine the best strategy for your organization by cost and throughput. Ask yourself what cost-per-unit you’re targeting from a budgetary standpoint. You also need to consider throughput — how much volume do you need to produce in a specific amount of time to reach the required level of productivity? Note that temporary and seasonal workers typically have a lower productivity level than full-time employees, so that’s a factor you need to take into account. However, full-time employees who frequently work overtime can become tired, which also impacts their productivity levels, as well as the quality of their work.

It’s important to note than an MSP can be a valuable addition to your team. They build a contract with you and become an extension of your company. They subsequently recruit, hire, and train new employees, so you don’t have to. This frees you up to focus on other core aspects of your business.

For more information on how to ramp up your warehouse for peak season, speak to one of our specialists today.