Balancing labor shortages with higher demand for goods

A major concern our industry has shared while preparing for Q4 is the significant amount of delays caused by labor shortages. According to the Society for Human Resource Management (SHRM) survey, nearly 90% of the 1,200 employers surveyed reported having difficulty filling open positions. And yet, the Bureau of Labor Statistics reports that we do not have a current labor shortage due to approximately 9.5 million people classified as unemployed, and more than 9.2 million jobs with openings. In fact, the occurrence of labor shortages is a phenomenon that is actually not very common. Nevertheless, companies are struggling to fill positions which is causing massive ripple effects in supply chains.

There is no doubt that the pandemic contributed significantly to the labor shortage. Global shipments have slowed down, inventory has piled up, and shipping costs have skyrocketed as a result of massive layoffs, more disposable income as a result of reduced travel, and a vast increase in e-commerce sales. Supply chain disruptions are expected to continue into 2022, meaning they will, without a doubt, affect this year's holiday season. UPS International President, Scott Price, told news agency AFP that, "the logistics industry does not see 2022 as having any less disruption in supply chains than in 2021, I half-jokingly tell people, order your Christmas presents now because otherwise, on Christmas day, there may be a picture of something that's not coming until February or March."

Although goods produced domestically in the US might not take months to receive, it is impossible to know for certain what will occur. Companies understand the need to get their products to their consumers. A positive shipping experience leads to brand loyalty. However, is it possible for companies to balance the need for adequate shipping and great customer service with the inability to fill their workforces? 

Six Ways to Balance Labor Shortages With Higher Demand for Goods

(1) Spread Out Sales

It is common to hear about major sales events such as Black Friday and Cyber Monday. Due to their popularity, these events typically account for most of the Q4 profits, but the fulfillment issues are also substantial. Organizing sales events in advance of these big days can help companies avoid the bottlenecks that can arise during large sales events. This is true not only for your own company but also for carriers.

(2) Maintain Accurate Inventory Counts

Inventory management is key! For your company and customers to remain informed, it is essential to have good order management and inventory management system that works together. Purchasing an item only to discover that it is out of stock is one of the most frustrating customer experiences. Ensuring accurate inventory will not only increase your brand loyalty but also reduce the time that is spent trying to solve inventory management issues. Making sure every hour is utilized efficiently is crucial. 

(3) Consistent Consumer Communication 

From shipping and delivery updates to ensuring clear customer communication on your website, no detail should be overlooked. Communication is vital with your customers, especially during uncertain times. In the event that consumers are left to guess information about their orders, they will undoubtedly search for the information, which can lead to a backlog of phone calls and a delay in higher-tier customer service issues.

(4) Diversify Carriers 

There is no doubt that carriers will face challenges during the holiday season. Like every other company, they, too, have difficulty hiring enough employees, and even their required overtime cannot meet the current demand. At certain times, some carriers are more active than others. Furthermore, some carriers may have an easier time obtaining workers than others, which means you can take advantage of their services. The best way to stay on top of orders is by diversifying your carriers. Then, with shipping technology such as ShipWise, you manage your rate cards for each carrier and choose which delivery service best fits your needs for different order batches or individual shipments.

(5) Offer Various Shipping Options 

Many consumers will choose the free, 5-10 shipping option over the overnight or two-day expensive shipping, but some want to package immediately regardless of cost. By offering multiple shipping services, the consumer feels like they have more control over the process. If a consumer chooses the longer shipping option, they will have to accept that it might be slower than desired. 

(6) Keep Trying to Hire

You most likely don't need to hear this, but keep trying to hire! Offering specific bonuses or employee benefits will help attract the right kind of employees to your business. Additionally, offering existing employees bonus pay or overtime can help keep things running smoothly until more people can be brought on.