This article examines key strategies for ecommerce business owners to optimize warehouse operations, drawing on insights from our brand-new series of ‘Ask Amandeep’. The videos recorded on location at Saint & Sofia’s warehouse offer the perfect introduction to key elements of warehouse management, as presented by our Client Success Manager, Amandeep Bhatti.
- 1. Inventory Management: The Foundation of Efficient Operations
- 2. Picking and Sorting: Streamlining Order Fulfillment
- 3. Packing and Dispatch: Ensuring Accuracy and Speed
- 4. Returns Management: Handling the Reverse Logistics Flow
- 5. Warehouse Layout and Design: Optimising Space and Flow
- 6. Performance Monitoring and Dashboards: Data-Driven Insights for Continuous Improvement
1. Inventory Management: The Foundation of Efficient Operations
Effective inventory management is crucial for any ecommerce business. Amandeep emphasizes the importance of accurate tracking, efficient receiving and putaway processes, and regular stocktaking.
- Goods In and Put Away: Implementing a streamlined goods in process that utilises barcode scanning for verification against purchase orders is essential for maintaining accurate inventory records from the outset. This accuracy is crucial to prevent issues further down the line in picking, packing and dispatch. After verification, goods should be efficiently moved to their designated storage locations, again using barcode scanning for direction and confirmation, ensuring items are easily locatable when required.
- Stocktaking: Regular stocktaking is non-negotiable for maintaining financial accuracy and preventing overselling. If adopting a cycle-counting approach, teams should be checking a few locations every day, or spending a few hours a week when picking demands are lower. Ideally, no location should go unchecked for more than 60-90 days. By physically scanning each item and its location, businesses can ensure their inventory data matches their physical stock. This process mitigates the risk of selling products that are out of stock, which can lead to customer dissatisfaction and potential financial losses.
- Single-SKU per Location: We here at Peoplevox advocate for a single-sku per location system, depending on your product type and typical order profile, as well as potential constraints on warehouse space. This system assigns each unique product (SKU) to a specific location, simplifying the picking process and reducing errors. Pickers can quickly locate the required item without sorting through multiple products in a single location, leading to faster picking times and improved overall efficiency.
2. Picking and Sorting: Streamlining Order Fulfillment
Efficient picking and sorting processes are vital for timely order fulfillment. Amandeep recommends specific strategies and some unique hardware to optimize these operations.
- Pick and Sort to Trolley: A pick and sort trolley system significantly enhances picking efficiency. This system utilizes a trolley with designated slots or totes, each representing a separate order. Pickers can move through the warehouse collecting items for multiple orders simultaneously, sorting them into the corresponding totes on the trolley. This method minimizes travel time and streamlines the packing process. We have seen picking efficiency increases of over 40% using this tactic.
- Sequencing: Optimizing picking routes, known as sequencing, is another key factor in efficient order fulfillment. Sequencing involves strategically planning the picking route to minimize travel distance and ensure efficient trolley weight distribution. This might involve arranging picking locations alphabetically or in a way that corresponds to product popularity, minimizing the time and effort required to complete each pick.
3. Packing and Dispatch: Ensuring Accuracy and Speed
The packing and shipping stage is the final step in the fulfillment process. Amandeep highlights the importance of an optimized pack bench setup and a robust scan to ship system to ensure accuracy and efficiency.
- Pack Bench Setup: An ergonomically designed and well-equipped pack bench is essential for a smooth packing process. Key elements include a raised monitor for better visibility and space utilization, a hard-wired scanner for reliable connectivity, and readily available packing materials such as boxes, packing peanuts, and pre-printed packaging barcodes. These elements minimize unnecessary movements and ensure packers have everything they need within reach.
- Scan to Ship System: Implementing a scan to ship system is crucial for verifying order accuracy before packing any order. Every item in the order is scanned, followed by a ‘ship now’ barcode, confirming that the correct items are being sent to the customer before printing the label. This double-checking system significantly reduces the risk of shipping errors, improving customer satisfaction and minimizing costly returns.
4. Returns Management: Handling the Reverse Logistics Flow
Returns are an inherent part of ecommerce, and efficient handling of returned items is essential. Amandeep explains the benefits of integrating returns into warehouse operations for greater visibility and automation.
- Returns Processing: Integrating the ecommerce platform’s returns portal with the warehouse management system allows for real-time tracking of incoming returns. This visibility enables warehouse staff to anticipate the volume and types of returns, facilitating better planning and resource allocation. Additionally, automating the refund process for eligible returns can significantly expedite the process, improving customer satisfaction and freeing up customer service resources.
5. Warehouse Layout and Design: Optimising Space and Flow
A well-designed warehouse layout is fundamental to efficient operations. We typically recommend a layout that facilitates a clear flow of goods, strategically utilizes space, and is tailored to the specific needs of the business.
- Dedicated Zones: Establishing designated zones for specific functions, such as goods in, goods out, picking, packing, and returns, is essential for a streamlined workflow. This separation of activities reduces congestion, improves organization, and minimizes the risk of errors or delays.
- Space Utilization Around Beams: Support beams and other structural elements often present challenges in warehouse layouts. However, these areas can be effectively used by incorporating additional storage solutions such as shelving units, maximizing the usable space.
- Pick Face Design for Fashion and Ecommerce: Ecommerce businesses, particularly those dealing with fashion or smaller items, can benefit from large pick faces with single-SKU locations. Unlike traditional large-scale racking systems, these pick faces are more suitable for the frequent picking of individual items, allowing for faster and more efficient order fulfillment.
6. Performance Monitoring and Dashboards: Data-Driven Insights for Continuous Improvement
Data analysis plays a crucial role in optimizing warehouse operations. Descartes Peoplevox’s functionality here is a great example in the use of warehouse dashboards to monitor performance in real-time and identify areas for improvement.
- Warehouse Dashboards: Real-time warehouse dashboards provide a comprehensive overview of key performance indicators. Metrics such as the number of items dispatched, user activity, picking progress, order fulfillment rates, and returns data can be visualized and tracked. This real-time data allows managers to identify bottlenecks, track employee performance, and make informed decisions to optimize processes.
By implementing the strategies and technologies outlined in this article, ecommerce businesses can significantly enhance the efficiency of their warehouse operations. From inventory management to order fulfillment and returns processing, every stage of the warehouse workflow can be optimized to reduce costs, improve accuracy, and ultimately, enhance customer satisfaction.
