How a year has changed logistics and fulfilment forever
The rise in home shopping during the coronavirus pandemic and the impact of stockpiling ahead of Brexit has created increased challenges for logistics operators in an already demanding environment even including a global cardboard shortage. As specialists in logistics, PDS has recently welcomed a new director for commercial services who has taken over the management of its own logistics operations. We spoke to James Portsmouth about his thoughts on current issues in the sector and what businesses should be thinking about in 2021 to improve their efficiency.
At the beginning of the year, we were hearing stories about goods being delayed at borders. Are things running more smoothly again now?
“As a result of Brexit, UK businesses have had to be a lot more robust in their approach to logistics and the changes have helped to focus minds on processes and detail. There is more paperwork to complete, and businesses need to make sure that they are on top of the new rules about where duty applies so they can make payment using a Duty Deferment Account (DDA). Everyone exporting to Europe now needs their own EORI number, an MRN number for when goods go through customs, and, if appropriate, a European VAT number. Every product must have its World Trade Organisation (WTO) code to comply with global trading rules, whether its print, merchandise, or other types of goods. It can be helpful to ship the paperwork in advance of the consignment to avoid any delay with customs.
“There is no doubt that the costs associated with logistics have increased because of the additional administration. Even if your paperwork is in order, a large haulier might be transporting goods for multiple customers and it only takes one hold-up to cause a delay.
“It is important to think about transportation routes now, too, as it is more efficient to ship goods from China and the Far East direct to Europe bypassing the UK and removing a complex link in the supply chain. Once everything is in place, processes become much more straightforward but there is no doubt that extra time for planning ahead needs to be built into logistics operations.”
When they have taken delivery of goods, what can businesses do to maximise their warehousing and storage space?
“It is very easy for warehouse space to become disordered if there is nobody responsible for keeping it organised. A lack of order reduces awareness of what is in stock enabling items to become out of date. Housekeeping is probably the single most important principle of good storage and it is vital to keep on top of it. At PDS, we make sure that we recycle old stock as part of our drive to make our operations as environmentally friendly as possible. We follow the framework of the international standard ISO 14001 which sets out the requirements of an effective environmental management system.
“Space management is an intricate science, and it is important to store smaller items in small spaces positioning fast-moving items at the front, or near the end of aisles so that they can be accessed more easily. At PDS we have a dedicated job role to monitor housekeeping and organise stock because it really speeds up operations and keeps other colleagues free to fulfil client orders.
“I would also advise using the most suitable types of shelving and racking to accommodate the goods on hand. At PDS we have switched to using Pallite® PIX lightweight, flexible storage systems that create a more user-friendly pick-face and free up space in the warehouse. Using systems like this, you can make more efficient use of space, increase the yield of your warehouse, and improve your overall supply chain efficiency. A review of your storage methods might reveal that you do not need additional warehouse space providing you use the existing space more judiciously.”
With many people still working from home, will businesses continue to operate their own warehouses?
“The Covid pandemic has seen a step change in attitudes to flexible working and the UK has proven that it can operate with the vast majority of its employees based at home. With a distributed workforce, business owners are looking at office premises and realising that they may be able to save money on business rates and reduce the size of their estate. Companies like PDS are well placed to offer alternative solutions and can provide warehousing and logistics services for businesses that are rationalising their estate and making the decision to downsize. In-house mailrooms are changing too with the distribution of items within a business now becoming more of an external operation rather than an internal messenger service.”
Where has PDS seen an increase in demand and how have clients changed their behaviour over the last year?
“We have seen a huge increase in gifting since 2020 and the fulfilment of orders has become more and more complicated. For example, businesses are ordering gift hampers for their clients to replace physical experiences and the types of hospitality that they might have enjoyed pre-Covid. In an effort to replicate an experience, clients have become highly creative with their requests; a hamper may contain all the elements for a games’ night at home, a sports activity, or a pampering session. We are often working at pace to turn around requests very quickly. Partly because of the timescales, most of the items for our gift hampers are UK-sourced.
“Wellbeing is a huge theme as everyone works to mitigate the effects of lockdown on our mental health. We have fulfilled some amazing creative requests for our clients including indoor gardens lit by UV, footballs, slippers, and essential oil holders. Clients have been challenging us with their briefs and our design studio, agencypds, continues to deliver the creative ideas that delight their customers.
“Staff gifting has also grown hugely during the pandemic with businesses keen to show their appreciation for the way that their teams adapted so quickly to new working arrangements. We have been able to help HR managers with our expertise on some largescale projects. If a business typically has 8,000 staff based at 300 locations, its fulfilment database may need to increase by as much as 26 times. With so many consignments to organise, external help is essential to tackle the task of unpacking and re-packaging goods, ensuring that items are stored efficiently and despatched securely to prevent breakages.
“The world of logistics and fulfilment has certainly been through a sea change in the last twelve months, and we have learned a great deal and are in a good position to lend a helping hand to anyone who needs some expert advice.”
Contact us to find out more.