Logistics firms turn to outsourced recruitment solutions to manage consumer’s last-minute temptations.

According to research from PWC, 50% of Brits have no intention of buying anything on Black Friday even if the price is right. However, 70% of under 25-year olds, and 65% of 25-34-year olds are primed and ready to go. It’s a story of two generational halves. Apparently, whilst one in three under 35s expect to buy, one in ten shoppers plan to avoid Black Friday altogether– with most of these people over 45. 

But whilst that may be true in the run-up, many a good intention disappears when faced with temptation. According to online data specialist PCA Predict, the peak minute for purchasing goods on Black Friday 2017 was towards the end of the working day at 4:38pm. Clearly, minds can change as the day unfolds.

And change they often do. In the middle of all the consumer beliefs, well-made intentions, targeted buying, weak wills and ‘go on then’ choices, lie the logistics firms who fulfill that pre-planned purchase or last-minute whim. 

So, what does Black Friday look like for those that have to deliver the cut price TVs and once in a lifetime bargains? GRI has a unique perspective. We are the temporary workforce management expert who partners with five of the UK’s largest 3PLs, as well as a number of key players in parcel delivery (who between them are accountable for 50 per cent of the sector by volume - over 1.6 billion parcels a year).

Compared to an average week, the direct effects of Black Friday comprise a window which usually starts around three to five days before (as increasingly retailers adopt earlier and earlier pre-Friday deal strategies) rolls into cyber Monday and continues on for around a week more. Then the activity directly attributable to Black Friday dwindles and moves onto the ’usual’ pre-Christmas peak.

A review of contingent worker staffing over that timeframe shows that, across the board in terms of all skill sets needed by logistics firms generally, 95.2% more temporary worker hours are required during the Black Friday window, in comparison to an average week throughout the rest of the year.

Within that finding, trends relating to some specific skillsets also emerge:

Temporary Worker Hours Required

Black Friday Increase on An Average Week

Warehouse Operatives

175.9% More

Van Drivers/Multi-drop

88.9% More

C1 Drivers

72.2% More

LGV C Drivers

196.3% More

LGV C+E Drivers

81.2% More

 

Across this picture, huge regional differences will be in play. The Midlands typically requires the most additional contingent staffing with 126.9% more temporary worker hours required over the period, the highest of all the regions and 31.7 percentage points higher than the average across the country. 

With such an enormous demand, organisations that deal directly with recruitment agencies for temporary workers, can often fall victim to distress purchases by paying hugely inflated exception rates in order to bring staff on to fulfil deliveries that otherwise could not be made. Our analysis of invoices from agencies supplying outside of the neutral vendor outsourced agency management model that GRI offers, reveals these costs can often be up to 35% more than usual.

For GRI clients, we ensure rates and margins continue to be standardised and regulated despite the pressures of Black Friday. Rate rises are usually the last resort not the default go to. In 2015 during the three-week period of before, during and after Black Friday, the average cost increase for hiring drivers was 16 pence per hour on average. In 2016, the increase was 19p per hour and in 2017 it was 21p per hour.  Often these increases reflected not hourly rate rises but an end of assignment retention bonus strategy. A far more palatable and successful cost strategy than is usually seen in organisations who try to manage their agency relationships themselves.

GRI is also able to achieve a more cost-efficient Black Friday thanks to in-depth pre-planning to ensure huge volumes of additional temporary staffing is in place, well in advance. Thus, avoiding last minute rate hikes as a method of candidate attraction.

Typically, GRI will start planning how the peak period will be staffed around April time, seven to eight months ahead.  Working in partnership with our clients, our contract and performance management team:

  • Review last year’s fulfilment figures and agency performance
  • Account for any new business won or lost since the previous period and forecasted
  • Analyse any changes to our clients’ current and forecasted customer profile
  • Review last year’s volumes
  • Account for an appropriate increase based on a variety of management information and market intelligence tools

From there an agreed plan and process is confirmed with our clients and their agency panels. We then visit each site and region within our clients’ footprint to ensure the required stakeholders at a delivery centre, depot and site level are aware of the plan, the process that will be followed and which agencies will be responsible for the provision of the required temporary worker skill sets. We will additionally consider whether temporary labour taken on during this peak period can be offered longer-term contracts or permanent positions post-event, as our clients seek to offer opportunity to the workers who make Black Friday possible.

Whilst the Black Friday temporary worker strategy will be in place well before the event, GRI will continually revisit the strategy due to the inevitable change that typically takes place due to market forces or organisational developments. Depending on the level of change and how last minute this change is, we will deliver fulfilment levels of 98.5% to 100% from Black Friday into the Christmas peak.

A key challenge to 100% fulfilment levels is last-minute purchasing, especially as the final order by times for next day delivery (or even same day delivery in certain cases) marches ever closer to the wire. At organisations that operate to, or commit to, the tightest of turnarounds, morning and afternoon forecasts run to predict the number of drivers and warehouse operatives that will need to be on key shifts.

However, the differential between the AM and PM forecast usually varies enormously and can often shift beyond even pre-planned forecasted predictions. This is where our extensive national agency influence (we work with 20% of the agencies in the UK) can ensure candidates are available – again without price hikes due to our commercial arrangements with these agencies.

What is also interesting about the Black Friday period, is that planning for it does not just impact the retail or logistics clients directly affected. As the upsurge in demand demonstrates, if hubs in the Midlands require nearly 130% more temporary staffing hours to cope, other clients who also need drivers for their businesses during that time period will also feel the effects – even if they are in the waste and recycling industry for example. 

This is where GRI will also bring our expertise to bear, in ensuring that business as usual also continues for organisations that additionally need the same volumes of temporary drivers despite the pool of available talent actually shrinking due to peak demands in the vicinity.

When your Black Friday peak has passed, the dust has settled, and your KPIs are in, we can help your organisation surpass 2018’s performance in 2019  - without inflating your costs.  Tempted to find out more? Contact info@geometricresults.co.uk to arrange a discussion.

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