Outsourced packing removes labour headaches

The warehousing sector is having to come to terms with the challenge of rising labour costs and is constantly seeking ways to boost productivity levels in the logistics chain. Tyron Hubbart, general manager of Outsourced Project Solutions (OPS), which provides outsourced services on a per project basis, said one way businesses were looking to save was through outsourcing product bagging and packing of containers for road, rail and sea cargo, on a per ton rather than an hourly labour cost basis. “The largest challenge facing the warehousing sector is coming to terms with increasing labour costs, managing variable labour costs and then still having to negotiate the very tricky and restrictive labour law amendments surrounding the use of casual labour,” Hubbart said. Businesses across the country have turned to the company to handle projects on site ranging from 500 to 50 000 tonnes of goods per month, he said. The company recently started loading minerals from stockpile into containers at a per ton rate but the primary demand has been for outsourcing the bagging of commodities such as fertiliser, cotton seed, coal and chrome, he added. It supplies the hopper or bagging plant and equipment such as forklifts, Bobcats, scales, labour and supervision, required for each project. “This means a client can call us up to bag a thousand tons of chrome and load it into containers. OPS arrives on site, bags the cargo, loads it into containers and then leaves,” he said. “OPS seems to have found a way to increase productivity of labour while at the same time helping the client avoid dealing with all the challenges that labour brings to business,” he said. “Outsourcing specific work as a project does away with the need for hiring labour brokers or TES companies,” he said. Hubbart said there was also an increasing trend to load bagged cargo onto rail and road wagons at a per ton rate. “Labour is increasingly also paid at a per ton rate, which improves productivity of loading. Labour who are paid hourly rates have a tendency to drag the work out, so they earn longer hours and overtime,” he said.