Are Retailers Ready to Take the $3.5 Trillion Bull by the Horns?

By Eric Lamphier,
Are Retailers Ready to Take the $3.5 Trillion Bull by the Horns?

Today just about anything, from books and software to groceries and medication, can be purchased without ever entering a store. E-commerce is not just a market opportunity for businesses; it is a phenomenon that defines a customer’s experience with a brand. 

With e-commerce retail sales projected to reach $3.5 trillion by 2019, there is a lot more at stake than just fulfilling orders. Brands and shippers are rethinking how they organize and structure their distribution center (DC) operations, inventory management systems, ordering and store-based fulfillment processes. Further, they are looking to add many new elements that are purpose-built for speed, customer experience, mobility and the unique requirements of e-commerce fulfillment.

Ditching the Desk and Optimizing for an Omnichannel Environment

The multi-brand mega DCs of today require warehouse managers to be on the DC floor most of the day. Managers must have the ability to address any operational issues, including inventory, slotting, order processing and warehouse workflow, directly from the floor using their tablets or mobile devices. This increased mobility drives real-time engagement with DC operations, as well as productivity and efficiency.

Traditionally, warehouses were optimized based on seasonality or periodic inventory resets. As brands introduce and promote new products on a near-constant basis, warehouse inventory is changing much more regularly. Re-slotting schedules have increased dramatically, thereby straining warehouse operations. This is why warehouse managers need to be able to execute re-slotting requests directly from the warehouse floor using their mobile devices, as opposed to returning to their desktop computers.  

Driving Workforce Productivity

During peak seasons, a retailer can ship up to 20 times its normal volume, which often requires a significant uptick in temporary workers. Ensuring that the legions of temporary workers are productive and efficient, with minimal onboarding time, is imperative in e-commerce centric DCs defined by high volume orders. Training this influx of seasonal staff takes considerable time.

Picking solutions that offer touchscreens and rich graphical interfaces can deliver “zero training,” alleviating major throughput bottleneck in DCs by enabling inexperienced personnel to achieve high levels of productivity immediately.

Many e-commerce distribution centers utilize a put-wall system to efficiently sort inventory for specific consumer order needs. DC managers need to employ an operations-based approach that is intuitive and guides associates through the inventory sorting process rapidly and without mistakes by seamlessly interfacing the warehouse control system with the put-wall feature light systems.

Accurately packaging products for shipment is the final step in effective e-commerce order fulfillment, and it is critical that temporary workers fill orders correctly. Visual cues and pictures of objects are components of the system known to help people process information faster. Enhancements to the packing stations, including full item images and touchscreens, ensure order accuracy and intuitive interaction to facilitate easy order completion and shipping.

Streamlining Order Fulfillment

E-commerce order fulfillment presents unique challenges, including peaks and valleys in labor, changing priorities and constant order acceptance. Order streaming optimizes the entire fulfillment process for each individual order, enabling proactive inventory replenishment, more consistent labor utilization and optimal individual order throughput. By adopting order streaming, warehouse operations teams can ensure smoother labor curves throughout the entire fulfillment and replenishment process and enable managers to easily refocus order prioritization as needed.

Stepping Into 21st Century Omnichannel Commerce

As omnichannel continues to grow in prominence, today’s brands are confronted with the challenge of fulfilling numerous, generally small e-commerce orders at a speed that meets consumer demands. The next generation of DC operations, inventory management systems, ordering and store-based fulfillment solutions enables warehouse managers to quickly and easily scale distribution to take on the $3.5 trillion market opportunity.

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