14 January 2021

Warehouse: How to Manage Contingent Workers and Staffing Agencies

John Clark
John Clark

Managing a warehouse is hard work. Your job is to get physical products into your customer’s hands in as little time, and as seamlessly, as possible, no easy task when you have to deal with a large number of moving parts and seasonal demand that dictates how you manage your warehouse. 

As a light-industry orientated business, your warehouse is customer-focused. The customer experience (CX) is a crucial component to the success of your business, and managing your warehouse correctly is key to building a superior CX.

Balancing costs with meeting customer expectations is the key to boosting profits. 

Labor is the largest operating expensive in a warehouse, and uses up anywhere from 50 to 70 percent of your budget. That’s why the use of temporary labor is an important aspect of not only managing your overall costs, but also meeting customer demand. 

In this blog, Conexis VMS takes a look at why the use of temporary staffing can help your warehouse meet its goals, what challenges are associated with managing a contingent workforce (and the staffing vendors you use to source temp workers) and how you can manage it successfully through a vendor management system (VMS)

How temporary workers help your warehouse meet its goals

Placing temporary workers in your warehouse can bring you a wide range of benefits - all of which help your organization to achieve its business goals.

Here are some of the top reasons your warehouse will benefit from the use of temp labor.

Workforce flexibility: Hiring full-time employees when you don’t need them is a waste of money and will cut into your profits, but, at the same time, not having enough workers when you need them can seriously damage your customer experience. Using temp labor gives you the workforce flexibility you need to adapt to seasonal demands and other business fluctuations experienced throughout the year. You can access the headcount you need, only when you need it. 

Save your business time and money: Recruiting full-time workers takes time and money, and in an industry where there’s a notorious high turnover rate this process can be even more costly. The use of temp labor gives you access to experienced candidates without the costly and time-consuming recruiting process involved with full-time hiring.

Access to qualified candidates: Need a worker with qualifications or experience in the operation of forklifts, shipping and receiving, packing, loading and unloading or any other skill? Staffing agencies have a large database of workers who are qualified in the exact role you are looking to fulfill. 

Turnover reduction: The other big benefit to warehouse managers is turnover reduction. Some warehouse experience over 80 percent turnover which creates massive customer satisfaction issues not to mention unnecessary costs related to training and inefficiencies. The placement of successful temp workers can dramatically reduce turnover in your warehouse. 

Why you need to properly manage your temp labor and the vendors you use to source them

As we mentioned before, the use of temporary labor is a great way to manage both warehouse costs and customer expectations - ensuring your warehouse remains highly profitable at all times, no matter how much demand you are experiencing. 

This, however, is only the case if you are properly managing your temporary workers and the vendors you use to source them.

All too often we find that warehouses are managing their temporary worker using manual and time-consuming Excel spreadsheets, in-house databases, and sharepoint sites. Simply put, this is an ineffective way to manage your temporary workforce. 

Manual processes are time-consuming, inefficient, often lead to human error and don’t create a centralized place to manage temp workers or consolidate your vendors. This results in a lack of visibility and control over how much you are spending on temporary workers and the vendors that you use to source them. On top of that, inefficient management methods leave you with no insightful data on the overall performance of your contingent workforce management program. 

Without addressing these challenges, your warehouse is sure to be overspending on temporary workers and making poor staffing vendor choices.

How a vendor management system helps

A vendor management system is a cloud-based software solution that acts as a mechanism for your warehouse to manage every aspect of your temporary workforce. By automating each process and storing data in a centralized location, a VMS will give your warehouse complete visibility into the performance of your temporary workforce management program - with detailed insights into both temp workers and staffing vendors.

Through the use of a VMS solution, such as Conexis VMS, your warehouse will be able to use insightful data to make better staffing agency decisions, consolidate vendors into one centralized location for easy management, improve process efficiencies by automating key steps and save money through better hiring decisions.

Want to learn more about how a vendor management system can help your warehouse grow? Contact Conexis VMS today. Our team of temporary workforce management experts would love to answer any questions that you may have. 

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John Clark

John Clark

A Co-Founder of Conexis, and Staffing Industry Analysts’ (SIA) top 40 under 40 recipient, John has more than 15 years experience in the Contingent Workforce, Managed Service Provider and VMS technology space. John has designed, built and run dozens of client workforce programs across multiple industries, managing over $1bn in spend. John’s expertise sits in both program design and delivery as well as VMS technology implementation and management.

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