Decreasing labor, increasing robotics
Companies in China are now investing in robotics as the source of their workforce. Cheap labor and hardworking employees are rapidly decreasing due to the rising wages and competition from other cheap emerging markets, such as India. Investments in manufacturing from other countries are becoming less favorable to China. The one-child policy has hit China hard as they now have a shrinking workforce between 15-59 years old.
Small robots designed in Germany are the ones being targeted by Chinese factories. They believe it may be the only way to retain their industry; survival is now key to keep dominance in their manufacturing. These robots will be used to fill jobs with high turnover rates, creating a more efficient environment within the factories. Due to the increasing doubt in quality from Chinese products, hopefully the use of robots will inject confidence back into investors. In the next 2 years demand is expected to double for robotics in China, from 67,000 in 2015 to a predicted 150,000 in 2018. Investments are now being made in industrial technology, for robotics to be developed in China.
Read more on the investment here.
Eye on groceries
Target has announced a gross problem with their perishable items. It has been revealed that because of a lack of trade, items are spoiling before they have even been bought. This can be attributed to a drop in footfall and lack of so-called ‘fill-in’ trips. It has been said that the average Target customer is not solely shopping for groceries, but instead browsing this section after other needs. An online survey has shown that shoppers prefer traditional grocery stores to mass retailers, however Walmart seems to be the store with an advantage.
Target is now focusing on improving its supply chain, hiring industry experts to evaluate where they need to improve. Target’s supply chain was not made to deal with short shelf life products. This has led to a loss in inventory which has become higher than the industry average. They are now considering giving more control to a 3rd party. This will have less pressure on Target however is giving a lot of trust. This is a dangerous move compared to Walmart, who has successfully set up their own infrastructure. Only time will tell for Target; is it worth keeping their grocery section or abandoning it completely?
Check out more on the story here.
Deliver-who? Drivers’ strike against pay changes
‘Unfair’ pay is the reason for the past weekend’s strikes against Deliveroo’s proposed pay change for its drivers. Instead of an hourly wage, Deliveroo proposed a ‘per delivery’ scheme, a change from £7.20 per hour to £3.75 per delivery. This could result in either a minimum pay of £3.75 or even £0 if no deliveries are made. The scheme has been trialed in London with 280 out of 3,000 drivers taking part. Results have shown pay could be doubled if an efficient amount of deliveries are made in an hour. The payment plan also increases flexibility for drivers, most of whom have other jobs. From Deliveroo’s point of view, it will improve utilization of drivers. The company seems committed to improving their business in any way they can, even if it leads to controversy.
Throughout the week, concessions have been made due to the backlash, a wage guarantee of £7.50 during peak times and an opt-out scheme for drivers in the trialed area. Originally drivers had to agree to the deal or run the risk of being fired. This clause has now been removed. Deliveroo has now stated that if it does not work for the drivers, it does not work for us. The trial will be reviewed in a months’ time to give drivers a real awareness of how the scheme works and if it is as beneficial as Deliveroo believes it to be.
Read more on Deliveroo’s actions here.
Have a nice weekend!
