Online Shopping May Get Pricier Soon as Labor Costs Rise

May 30, 2017         By: Steven Anderson

Thanks to mobile payments, and the steadily growing ecommerce shopping front—the thing that’s killing brick-and-mortar retail on several fronts—online shopping orders are up in a big way, and that means more people are required to gather these orders together, put said orders in boxes, and ship said orders out the door and into our hot little hands.

That means there’s a bit of a labor shortage on, and it’s starting to drive up the price of operation.

New reports from Warehouse Mobile Solutions suggest that the combination of growing demand for online shopping and the accompanying uptick in warehouse establishment means that it’s increasingly difficult to find enough people to staff said warehouses.

Some reports put labor costs up over $12.15 per hour, and the current word from the Bureau of Labor Statistics says warehouse workers will necessarily double by 2020 alone.

This means one of two things must happen: one, there must be a huge new hiring binge in order to accommodate frantically growing demand, or two, there needs to be a more automated solution, like robots.

We’ve already seen some businesses make the jump to robotics, but robotics have a massive up-front capital expense, significantly more so than hiring a comparable staff of human beings. While robots save the operational expenses—no ongoing salaries, no sick leave, minimal downtime period—they cost a fortune going in.

So what does this mean for the average online shopper? It means a very good chance that prices are about to go up for online shopping, whether paid for by mobile payments or by some other means. The increased expense of this extra help—be it human or robot—will almost certainly get passed on to the customer.

If prices go up on online shopping, then there’s a chance that brick-and-mortar can get back into the limelight. Without the cost savings advantage, brick-and-mortar’s immediacy—no shipping delay for shopping in a store—takes that much extra precedent. Soon, online becomes what amounts to a great way to shop for used items—smaller presences mean smaller expenses—or for certain rarities that are hard to find elsewhere.

The ecommerce market may be about to change once again, and may be a change that gives brick-and-mortar a bit of extra hope.