In the wake of the pandemic, the modern warehouse is undergoing a facelift. Greater eCommerce sales paired with tight capacity see warehouses rolling out new technologies and practices to satisfy demand.
Flexibility in the face of fluctuating demand has been a hallmark of modern warehousing in recent years. Meanwhile, the march toward automation continues under the promise of greater cost savings and efficiencies. Modern warehouse design is shifting to accommodate these trends.
To create strong and flexible supply chains, modern warehouses are implementing a handful of changes, including:
- Warehousing goes on demand
- Automation increases
- IoT technology creates visibility and transparency
- Modern warehouse design goes green
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Read below to learn the modern warehouses trends and trends in warehouse management for 2021 and beyond.
1. On Demand Warehousing Creates Storage Capacity
COVID unleashed a wave of eCommerce resulting in lasting shortages of warehouse space. In turn, warehousing costs continue to climb as:
- Market demand outstrips supply after COVID
- Warehouse operations slow due to complexities of same-day returns
- Businesses seek to store inventories nearby customers to reduce cost and shorten delivery times
On-demand warehousing has emerged as a way for modern warehouses to increase their storage capacity. Like Airbnb for warehouses, shared warehousing monetizes unused space using new app tools. The pay-as-you-go model matches the variable needs of shippers that need space in the short-term, without long-term commitments.
For example, The Port Authority of New York and New Jersey (PANYNJ) has developed a database of all its unused warehouse space. The database allows companies to identify vacant space for short-term use, especially during seasonal spikes or periods of disruption like the pandemic. This makes it easier for East Coast shippers to scale and meet fluctuating demand, while creating extra revenue for warehouses as they try to set reasonable prices.
UPS created the Ware2Go tool to help shippers find on-demand warehouses. As warehouses adopt services that parallel those of distribution centers and third-party logistic providers (3PLs), other ports and distributors should embrace on-demand warehousing going forward.
Here’s a full guide to on-demand warehousing.
2. Automation Ramps Up
Can machines do all the work? Fully automated warehouses are at least a decade away, but more steps in the supply chain are being handed over to automation.
In the chart below, warehouse executives share their predictions for which automation type will be the top investment priority in the next 1-3 years, as published in Forbes.
Make way for automated sorting processes, palette shuttling, and stacker cranes. Automated shuttle systems, for example, allow warehouses to increase throughput and storage density without losses in productivity.
Shown below, these autonomous vehicles would replace traditional forklifts as a way to move pallets to storage racks.
Pepsi uses an automated pallet shuttle system in its New Zealand plant to store high volumes of varied products. These systems handle a wide range of SKUs while reducing needs for space and staff, without sacrificing speed or accuracy. With many facilities still understaffed over COVID safety concerns, automated systems are increasingly appealing.
Robotics Gets New Legs
Robotics is futuristic automation that promises to help warehouses be more productive while reducing picking and shipping errors.
Robotic picking, sorting and packing is already used by JD.com, an eCommerce giant in China. The company’s 40,000 square foot modern warehouse is fully automated and requires just five workers to service the machines.
Once robotics prove to be effective in more use cases, expect to see them more in modern warehouses.
3. Transparent Shipping Via Internet of Things (IoT)
Inventory visibility is a top priority for modern warehouse managers.
This is because identifying gaps in inventory helps warehouses squeezed on capacity to better use their space. Meanwhile, retailers and customers want transparency around package tracking to alleviate ‘where's my order?’ anxiety. In sum, modern warehouses need to know what’s in inventory in real-time.
Internet of Things (IoT) technology allows a birds-eye view of inventory and capacity at once. Equipped with IoT capabilities, any object becomes a net-connected node. In other words, it can share data and interface with other online systems.
Adding IoT sensors to shipments, for example, provides real-time visibility for warehouses as well as tracking transparency for customers. Using IoT technology also offers the following benefits to modern warehouses:
- Identify risks in supply chain
- Foster communication between supply chain partners
- Minimize damage and loss of goods
- Improved inventory management
- Real-time updates on weather and port delays
Management systems integrated with IoT are the foundation of the smart warehouses of tomorrow. From drones to autonomous vehicles, IoT lets technology talk amongst itself and share its data with warehouse workers.
3. Warehouses Build Up to Create Space
Real estate around shipping ports is expensive. To gain storage capacity without breaking new ground, warehouses are building up rather than out.
Modern warehouses are being built and remodeled with 40-ft clear heights instead of the typical 20 feet, according to Tripp Eskridge, managing director at the logistics supply firm CBRE. Raising the ceiling is a cost-effective way to create much-needed square footage in dense urban areas.
Meanwhile, renovating is an opportunity to implement new technology. As mentioned above, automated pallet systems can be built to reach these higher 40-ft clear heights, unlike standard forklifts. This overlap in modern warehouse design and technology makes it appealing for warehouses to implement new processes as they expand capacity.
4. Warehousing Goes Green
“Green warehousing” helps logistics companies offset costs and garner goodwill from consumers. In recent years, warehouses have seen an influx of energy-efficient systems and practices, including:
- Solar panels
- LED lighting
- Cool-roof systems
- Skylights (required in California)
- Green building materials (Hempcrete)
New green practices are already being built into modern warehouse design. Most notably, lights-out warehouses go dark in areas when human workers are absent. Combined with the uptick in robotics, warehouses stand to save big on heating and lighting costs going forward. Greening operations should see increased adoption as Gen Z and Millennials reach positions of authority in more warehouses and distribution centers.
These practices are also marketable. Shoppers increasingly align their spending with their values, meaning that companies that highlight their green supply chains can generate greater revenue and loyalties. For example, DHL is a shipping courier dedicated to be zero-emissions by 2050.
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Modern Warehouse Trends for 2021
The modern warehouse is changing. As you consider warehousing solutions, look for IoT technology, automation, and on-demand warehousing to get the best prices on international shipping and warehousing.
Thinking about scaling internationally? Easyship’s warehousing and fulfillment experts offer 24/7 support and insight. You can also access discounted rates up to 70% on storage and shipping to make your expansion a success.
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