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Automation as a labour strategy for the cold chain

More companies with refrigerated and frozen temperature-controlled facilities are adopting automation as a means to enhance the productivity of their existing team.

Automation can allow workforce retention as it handles the monotonous, repetitive tasks employees find boring or tiring. Photo by Supply Chain 247

Automation can allow workforce retention as it handles the monotonous, repetitive tasks employees find boring or tiring. Photo by Supply Chain 247

Once again, the most recent MHI Annual Industry Report — which queries 1000 supply chain leaders every year — found that hiring and retaining qualified workers persists as their top challenge.

If you’re a warehouse or distribution centre operator, you’ve likely experienced this in your own four walls. And, if you’re running a temperature-controlled, cold or frozen storage facility, you likely struggle more than the ambient operations sector to find and keep employees.

There is, however, an alternative to the workforce challenge: automation. Indeed, more companies with refrigerated and frozen temperature-controlled facilities are adopting automation as a means to enhance the productivity of their existing team.

A recently published white paper, “Automation: An Effective Labor Strategy in Cold Chain Warehousing and Distribution,” explores this approach.

The white paper examines both partial and comprehensive applications of automation in such facilities. It also details the benefits, including the ability for an operation to achieve higher standards of productivity, dependability, sustainability, accuracy, and safety.

Why is labour so hard to find?

There are a variety of reasons temperature-controlled operations faced multiple hiring and retention struggles prior to Covid-19, and why those struggles are likely to persist in the ‘new normal’.

  • Record-low unemployment prior to the pandemic.
  • Network optimisation strategies that located multiple warehouses and distribution centres in close proximity, creating tough competition for a finite number of workers.
  • Retiring Baby Boomers, many of whose supply chain jobs are unlikely to be filled by Generation X-ers and Millennials disinterested in working in the field.
  • The continued perception that warehousing and distribution jobs are unappealing.
  • Workers who lost jobs due to Covid-19 were primarily in hospitality, tourism, travel, and foodservice — fields they will likely return to as the economy recovers.
  • Re-shoring strategies are bringing manufacturing and supply sources back to the US and increasing labour demand.
  • Pandemic countermeasures that safeguard employees’ health, such as social distancing, result in fewer workers assigned to the same areas to handle the same amount of work, reducing productivity.

What process(es) should be automated first?

The average operation’s budget doesn’t allow for the automation of every process within a refrigerated or frozen facility. Therefore, it’s important to first quantify the anticipated productivity increase an automation investment will deliver across a variety of areas. By comparing the expected gains, automation projects can be prioritised. Areas to consider include:

  • Yard management
  • Unloading
  • Receiving and inspection
  • Put-away
  • Retrieval
  • Replenishment
  • Layer picking
  • Case picking
  • Palletising
  • Stretch-wrapping
  • Staging
  • Loading

Calculating and comparing labour costs by process

The processes within a cold storage operation that require the most labour hours are often the ones where automation will deliver the greatest benefits. To determine which processes are the most labour intensive, compare the average amount of time workers spend in each area to handle pallets or cases.

Further, implementing automation within these manual processing areas will not only increase worker productivity, but will also decrease the costs associated with the indirect labour required to support overall operations. Among them:

  • Security and safety equipment
  • Human resources staff and training time
  • Maintenance services
  • Housekeeping and cleaning
  • Information technology (IT) staff
  • Facility, operations, and shift management

Evaluating the automation options

Once the most optimal process areas for an automation implementation have been identified, it’s time to compare the different automated solution options.

A partial automated installation could include conveyor to transport cases or pallets into and out of refrigerated or frozen areas. Conversely, a more comprehensive installation might incorporate an automated storage and retrieval system (ASRS) to place and remove pallets or cases at multiple levels to minimise a facility’s footprint while boosting storage density. (Sample calculations are outlined within the white paper.)

Assess the different scenarios based on their anticipated labour and payroll savings to determine the optimal solution.

Automation benefits

Operations that implement automation as a labour strategy in their temperature-controlled warehouses and distribution centres will realise numerous benefits. Enhancing the bottom line are:

  • Lower operating costs through increased productivity, greater efficiency, reduced environmental footprint, lower energy consumption, optimised utilisation of floorspace, less need for temporary labour, a reduction in the need to recruit and hire new workers, and more.
  • Enhanced workforce retention as the automation handles the monotonous, repetitive tasks associates find boring or tiring. In a temperature-controlled operation, automation can minimise the amount of time personnel spend in the cold. Instead, workers can be reallocated to new tasks that are less physically taxing and more ergonomic. Further, with automation a company can offer more competitive wages, making it easier to recruit and retain employees.
  • Higher customer satisfaction because automation allows managers to focus less on guiding and overseeing people and more on ensuring processes are running as they should. This ensures greater consistency, higher productivity, increased accuracy, faster throughput, and reduced lead times — all of which make customers happy.

Source: Supply Chain 247