E-commerce continues to be a driving force behind the changes in warehouse fulfillment services as there is now a greater need for inventory availability and speed of delivery than ever before.
The rise of e-commerce is showing no signs of slowing down, which is a great news for warehouse fulfillment services but it also poses a lot of pressure on the businesses. There is a demand for goods to go out in a timely manner through multiple channels. This has prompted a need for the stock to be controlled in such a fashion that the common inventory is available for multiple channel order fulfillment. This is a challenge for those working in the fulfillment logistics industry because manufacturing and the purchasing related to it have seen consistent growth, which means more inventory than ever before must be managed.
Businesses that operate a fulfillment warehouse had to adapt in a way that enabled them to take advantage of the e-commerce opportunities available while still keeping fulfillment costs lower. Companies have approached this issue in different ways, with some opting to improve efficiency by having more than one warehouse that can deal with orders for multiple channels. This is popular amongst retailers because they are able to keep the inventory and fulfillment for all of their channels together instead of the usual channel separation.
There are a couple of reasons why this is more efficient, but the most important factor is flexibility. Forecast deviations can be better accommodated if there is a single inventory pool to draw upon, and cost savings can be made by using a common labor pool. It does mean that the complexity of inventory management has increased in order to match the channel fulfillment demands. Optimizing supply chain practices are essential to lowering costs, but it must also be done in a way that does not compromise with customer services.
A lot of time and energy is invested in determining what the timing of customer demand will be in an accurate manner. Doing this efficiently can ensure better customer service and can also offer a reduction in the costs related to the inventory of the fulfillment warehouse. These days, it is no longer enough to base purchases purely on sales information alone. Access to this information is only the first step and it must also be conveyed to the teams in the supply chain for it to be of any use.
Priorities must also be established to determine how multi-channel fulfillment should be managed. These priorities are determined by the type of company, but having them in place results in better inventory management.
Using a warehouse management system to manage the workflow in conjunction with a warehouse control system can streamline the process. However, this requires complex integrations. Failure to do so properly can also hinder the fulfillment process due to misrouted products or inventory inaccuracies. This is why some companies are opting for a warehouse execution system to combine the functionality of both these systems. When used in conjunction with automation, it is easier to retrieve products when needed instead of having to stage orders ahead of time. This can cut down on the time that is spent manually in handling materials.
Even with automation, there is still a need for skilled employees, and this requires proper training. Warehouse staff play an important role in ensuring that everything runs smoothly, and hence, they must be fully trained to understand the processes that they are dealing with.
In addition to proper training, there are also some technological advances that can be harnessed to better equip workers to do their job in an efficient manner. Wearable technology, in particular, has seen a lot of improvements in recent years and can be an invaluable tool for employees.
For example, when equipped with wearable technology, workers are able to connect to software such as labor management systems or warehouse management systems, which will allow them to operate far more efficiently. In addition to being faster and more accurate when employing wearable technology, workers can also get tasks done quicker if they do not have to move back to a central location for new instructions all the time.
This is especially useful now as the rise of e-commerce is changing the way in which material handling occurs. Frequent pick-ups of smaller orders are becoming more common, and technology that is voice-directed or arm-mounted is useful for workers. It can improve accuracy, which is essential when working in a fulfillment warehouse where orders are processed on tight deadlines.
While the exact systems you'll need depend on your business, there are some key IT points you can look into to help protect your supply and delivery chains as outlined below:
Gaining this type of technology is only one aspect of improving the efficiency of the warehouse. In order for it to work effectively, other factors must also be addressed. Wearable technology might improve the speed at which workers can operate, but it will be wasted if their travel distances are not optimized or the computer running the warehouse management software is not operating correctly.
E-commerce is also changing the shipping side of things as retailers need superior transportation networks in addition to higher warehouse capacity to meet the expectations of the consumers. The location is also very important. For example, a Los Angeles fulfillment center is in a better position to deal with imports from Asia to North America. In addition, inbound ocean freight costs will also be lower, along with the cost of inbound transportation from the Port of Los Angeles and the Port of Long Beach.
In addition to warehousing and order fulfillment, modern distribution centers are continually evolving to add value to their services. Inventory management is still crucial, but there is also a rise in kitting operations and customized order assembling that has made its way to the distribution centers. The companies that succeed will be the ones that can cope with the additional operational complexity and stay in control by using the right technologies.