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Post Covid World of Warehousing & Manufacturing

The world, our habits, the way we work, the way we shop is changing and it had been changing for the past decade or so. But the covid-19 pandemic has truly shocked and disrupted our lives like no other event in the recent history. It also lay bare one of our most crucial weakness, the global supply-chain.

Due to pandemic induced social-distancing measures, most people are staying home and working from home has become the new norm. Increasing need for ordering everything online has put a tremendous amount of stress on supply-chains which weren’t designed to handle such high influx of demand. The online surge of orders was a reality even before the pandemic, online retailers were struggling and optimising to fulfil consumer demands; the need for efficient and cost-effective back-end logistics had been building momentum over the past few years. But none foresaw the oncoming of a global pandemic with the potential to disrupt the entire global supply chain and create supply shortages worldwide.

source: Financial Times

This is definitely a black-swan event which is going to force many industries and companies to transform and optimise their back-end logistics and distribution models. More than 50% of the warehouses globally are completely manual and i mean ‘pencils & papers’ manual. According to a recent report by DHL, more than 83% of the warehouses use manual material transport processes internally. This approach worked fine until a decade ago, when e-commerce penetration was less than 5% and manufacturing processes were more or less set in stone.

The Indian automotive industry suffered USD 300 Mn loss per day and an estimated job loss in the sector was about 345,000 as a direct result of the pandemic. Credit: Reuters

In the modern world, especially in the post-covid modern world; online shopping will be the new staple for the majority of global population. Manufacturing processes will have to move away from capital-intensive and inflexible material transport solutions towards more sustainable, cost-effective and smarter solutions. Intralogistics will have to be optimised across the industries to accommodate erratic labour markets and consumer behaviours. Online retailers and manufacturers will have to make a deliberate effort towards reducing errors and enhancing process visibility to guide better decisions. A handful of industries had been adapting to the growing requirements already, but covid has severely shortened the timelines for adoption.

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