Warehouses “reaching capacity” with potentially “catastrophic” consequences, warns industry chief
06 April 2020
Non-essential goods are stacking up in UK warehouses and the consequences could be “catastrophic”, the chief of the UK Warehousing Association (UKWA) has warned.
Peter Ward, chief executive at the UKWA, says reduced outbound flows and store closures will turn inbound flows into “literally a mounting problem”.
“Inbound supply chains cannot simply be turned off, orders placed and dispatched before the lock down will continue towards destination, arriving at ports, requiring receipt, handling, onward distribution and storage,” he said.
He adds that warehouses are “quickly reaching capacity” and the consequences of this could be “catastrophic”, ultimately causing backlogs that could block the flow of essential supplies such as foods and pharmaceuticals.
Warehouses innovating to increase capacity
Ward also called on the industry to share unused space to deal with the industry’s capacity issues and warehouse operators are already responding.
Loadstar reports warehouses are re-configuring space to increase capacity and accommodate stock which is not yet required by importing businesses or ready for shipment from exporters.
Davies Turner are among several warehouses who are increasing numbers of pallet positions for customers as trade flows slow due to the COVID-19 outbreak.
Amazon prioritises household staples and medical supplies
Amazon has already been adjusting storage of stock to prioritize key medical supplies and household staples.
Ashley Cooke, an Amazon specialist at IOE&IT corporate partners Clickthrough Marketing, told the Daily Update:
“Amazon is prioritising essential goods, which means non-essential goods sellers have seen fulfilment times increased by up to a month.
“This is understandably having an impact on sales as consumers want products now, and are therefore more likely to look elsewhere or simply wait.”
A Wired report last month cited data from analytics firm Jungle Scout showing “94 percent of Amazon merchants use Fulfilled by Amazon for at least some orders, while 64 percent exclusively rely on the service.”
Cooke claims Amazon is looking to combat delays by hiring 100 thousand warehouse staff in the US alone “to respond to the surge in online shopping” and is targeting “unemployed hospitality workers” as potential new recruits.