For many companies, peak season hiring is an absolute necessity. The quality and the number of hourly workers can mean success or failure in fulfillment and your company’s service level and profitability.
Many of our ecommerce clients have peak order weeks which are 10 to 14 times higher than average. As much as 70% of sales and a higher percentage of profit is either made or lost in the holiday peak. For ecommerce sellers, the fourth quarter peak often overlaps with spring product introductions in late December through January.
Your local economy and regional competition are big factors for peak season hiring. One client in an area with less than 3% unemployment advertised for fall part-time workers. Human resources generated 45 potential candidates; only three were qualified and showed up for the initial interview. This resulted in having to do a quick compensation survey with others in their region. They ended up raising their hourly wages to be more competitive.
If Amazon is a local employer (as it is here outside Richmond, VA) it will set the pace for the number of part-time and seasonal associates hired and the wages paid. Here is a July 2018 ad from Amazon, listing an hourly rate starting at $11.75 for full-time, flex and part-time positions. Frankly, we were surprised at the rate but with low unemployment in the area, it’s a reality.
What are other employers in your area paying? Is your starting rate high enough to make it easy to find part-time seasonal labor in your fulfillment center? In many businesses, peak season hiring decisions are underway. Here are 12 considerations for being successful at this annual exercise:
Returning Seasonal Employees
Companies that have the greatest seasonal need often attract prior seasonal employees year after year. They stay in touch with those that performed well and want to earn some additional holiday money.
This can widen your talent pool. Make the peak season hiring bonus contingent on the referred associate staying the entire season and having acceptable productivity and attendance (define this in advance in your referral policy).
Like the “friend bonus”, make payment contingent on staying the entire season with acceptable productivity and attendance.
Internet Job Portals
Popular online boards such as Monster, Snagajob, Glassdoor and Indeed post an incredible number of jobs. We see companies posting the same job on multiple job portals.
Working With Temp Agencies
Using a temp agency is not often a favorite of fulfillment managers but is the easiest way to quickly source reliable associates. Pluses include the fact that the agency does screening and hiring, and also commits to provide a specified number of qualified workers.
Work with the agency to ensure the right to replace workers with a minimal amount of hassle. One downside is the increased costs, which in total may be higher than the hourly rate you pay internal employees. Keep in mind that you are not paying them benefits.
Billboards and Facility Banners
As we travel around the country we see billboard and banner advertising for fulfillment center workers along with their starting rates. What catches our eye is how high wages are compared to other markets.
Some recommendations may be too late to implement for peak season hiring in 2018. Consider these for next year:
As in the client example above, these should be done regularly. Especially for hourly workers, being competitive makes a huge difference in the number of candidates generated.
Develop a report to identify the turnover rate and reason for leaving, which is important. Some typical reasons can include “never came back from lunch,” “hired yesterday, never showed up today” or “I didn’t know fulfillment center work was so tiring.” Gather statistics that will help you address these reasons after the peak.
Determining the cost of hiring an hourly associate – and the cost of turnover – are also important. Consider recruiting a higher number of seasonal employees; as noted in the reasons above, some inevitably won’t work out, including those that bail after training, or even before.
Implement a Recruiting Website
Use this as a vehicle to advertise and recruit personnel, allowing candidates to apply immediately. Make it easy for them and you, cutting down on paperwork and phone time.
Hit the Local Job Fairs
From client experience, job fairs work well for some and not for others.
Weigh the Training Costs
Do you need more training time to make new associates totally productive at peak? Too often inexperienced and insufficiently trained people contribute little and increase costs.
Help with Pre-Qualifying Candidates
You may end up with large numbers of candidates for positions and it’s difficult to sort down who is actually qualified. Do you have an HR person or another manager who can pre-screen qualified candidates from resumes and applications? At a larger company adding hundreds of part-time seasonal workers, this is an immense job; and smaller companies may not have this separate position as it falls to the manager of operations or a C-level person.
Consider the costs of recruiting and how part-time and seasonal labor adds to your operations budget. But as seasonal associates are essential at many ecommerce companies to meet projections and hit goals, it’s not an optional exercise. Reviewing these considerations will give you a helpful checklist as you dive into staff expansion.