How Distribution Centers Can Mitigate Current Labor Shortages

Distribution centers in the food industry are currently facing a labor shortage. This is causing far-reaching effects across the supply chain and disrupting the fresh food market. The United States is also facing inflation and logistics challenges that are exacerbating the issue. Here are some of the factors driving the labor shortage and what you can do to mitigate it.

What’s Causing the Labor Shortages?

There are many different factors contributing to the current labor shortage:

• Concerns over personal health and safety due to COVID-19
• Burnout from the schedule and workload in a typical DC
• Demand for better pay and benefits

Businesses are doing everything they can to fairly compensate workers and keep them safe, but these are complex issues with no easy solutions. Some individuals simply aren’t willing to risk COVID-19 exposure. They likely won’t return to in-person work, even with safety precautions in place. Burnout has often been an issue in the past, but now the labor shortage is exacerbating the problem. And increasing employee pay and benefits doesn’t come without a sacrifice elsewhere, either in the form of reduced profit margins or increased cost to buyers and consumers.

How Labor Shortages Are Impacting the Fresh Food Supply Chain

Distribution centers are unable to fulfill orders in a timely manner due to a shortage of key staff, including truck drivers and quality control inspectors. These issues trickle down to the consumer as grocery stores face empty shelves and product shortages. Overall, current labor shortages are decreasing productivity and creating unpredictable supply chains.

Potential Solutions for Distribution Centers

Fresh food is the most basic, yet vital industry. Organizations across the supply chain are getting creative as they overcome labor challenges and continue to deliver the food we all need. Here are a few ideas for companies whose distribution centers are struggling to navigate staffing shortages.

Increase Your Current Employees’ Efficiency

There are generally two ways to approach labor shortages: hire more people or make your current team more efficient. If you’re already struggling to find new workers, try turning your attention to current employee efficiency. Could you provide your team with additional tools to help them do their tasks more efficiently and accurately? Can you cross-train employees so that they’re able to take on more responsibilities? Just be mindful of maintaining a balance. Overworking your staff may drive employees out of your organization.

The ideal approach to efficiency is reducing the time it takes for your employees to complete routine tasks. The inspection and rejection process can be especially time-consuming at DCs. But with the right tools, you can make it less cumbersome. For example, entering data and writing reports on a mobile device is more efficient than using paper. In fact, iFoodDS was able to cut the report process down from 45 minutes to 15 minutes per rejection report for one of our clients using our Quality Insights software.

See how you can boost your workers’ efficiency with Quality Insights.

Improve Your Processes

Analyze your current inspection processes and look for any steps that may be unnecessary or could be more efficient. Here are some ideas for process improvements:

• Use data to identify common trends so you can allocate inspectors’ time and resources more effectively.
• Audit your inspection processes across different distribution center locations to make sure they are consistent and meeting their goals.
• Evaluate the time inspectors spend at their desks writing reports and compare it to the time they spend inspecting. Ideally, your report writing process should be quick and portable so that inspectors can spend most of their time on the floor.

While process improvements won’t directly solve labor shortages, they will help you maximize your current output.

Focus on Engagement and Retention

While you may have no control over the current labor market, you can take steps to retain current employees. Focus on improving engagement and meeting your workers’ needs, especially their need for the proper tools to do their jobs. If employees feel like they don’t have the resources to do their jobs well, they won’t feel fulfilled in their roles. It’s important to gather data rather than making assumptions about what your team wants. Try sending out an anonymous survey to get feedback for improvements. In the long run, it’s more cost effective to retain existing employees than hire and train new ones.

Build a Core of Knowledgeable Workers

It’s important to keep in mind that losing your veteran employees will lead to a knowledge gap in your staff. While hiring as many new workers as possible may be your current priority, also take time to build up your “core staff.” These are your top employees who consistently perform well and understand your products and processes. Building up this core staff goes hand-in-hand with employee retention. At the same time, look for ways to help new employees get up to speed quickly so that you can adapt if more senior staff members leave. This could include a revised training program, easy-to-use technology for faster onboarding, and a mentorship program to pass on knowledge from veteran employees.

What’s on the Horizon for the Food Industry Labor Market?

While there is always a degree of uncertainty in the labor market, it seems that many of the trends we’re currently facing will continue to grow. A recent Deloitte study found that food industry executives see labor retention as an ongoing challenge for the future. Product suppliers and retailers also see a need to implement more technology in their organizations to improve efficiency and be less dependent on fluctuating labor issues. Three in five of the executives surveyed want to automate more processes to alleviate worker shortages.

For companies considering technology and automation, it’s important to know what your goals are before investing in a particular solution. How do you expect technology to improve your current procedures? Are there any particular functionalities you need? Take time to consider what’s important before you start to compare vendors.

If you’re currently in the process of vetting technology solutions or want to get started, reach out to iFoodDS. We offer a Quality Insights solution for distribution centers and suppliers. Our software application automates your processes and data capture, improving efficiency and helping you alleviate worker shortages. Request your free demo to learn more.