Find Out the Right Order Fulfillment Automation Solution

For a growing number of merchant companies, automated systems have become a way to address the issue of increased throughput, order accuracy and returns. In addition to accuracy, often the biggest driver of automation decisions, the ability to achieve higher throughput per headcount, increasing efficiency while keeping down labor costs, is also paramount.

Since picking and packing usually account for more than 50% of labor costs, identify all non-automated ways to streamline the labor involved in those operations.

  • Conduct an objective analysis of operational pain points and costs. Take a methodical approach to defining all opportunities and potential solutions, and involve warehouse staff. Frontline personnel know the issues and can often contribute valuable ideas.
  • Get a thorough understanding of existing productivity and costs by department, unit and line, as well as per order and per package shipped. Be selective and methodical about identifying and assessing areas and applications most likely to yield cost-justifiable benefits.
  • Assess every conceivable area where automation might help will simply result in confusion, paralysis and a lot of wasted time and effort. Focus on assessing just those areas that are most likely to deliver business benefits
  • For each area, estimate the savings in labor reduction, the ability to track inventory through the center, reduction in errors and throughput of customer orders, using an 18-month payback as the guideline. This will provide a solid read on the level of automation that can be cost-justified based on your operation and cost structure.
  • Make sure the solution you’re considering is sufficiently flexible and scalable to accommodate changes like product assortment or increased volume that would affect layout needs or the fulfillment model.

If you’re running out of floor space or know you’ll be there soon, automating your storage and picking process can greatly improve storage capacity and allow room for growth. Systems like a vertical lift module or another goods-to-person system can improve storage capacity by 40%–60% or more. You also need to weigh the cost of investment in your overall facility vs. automation equipment. Typically, the time, effort and cost of retrofitting your building far outweigh the cost of an order fulfillment automation system.

Assemble-to-order with Planned Orders

Assemble-to-order with planned orders is particularly useful:

If production control is managed using production orders (see Special Settings for Projects) but you do not want to create the production order along with the sales order. You can use the planned order to fine-tune planning and then convert it into a production order at a later date.
If production is controlled using Repetitive Manufacturing. The planned order is then the run schedule quantity which you can plan using the planning and control tools provided by Repetitive Manufacturing. In this procedure, the goods receipt for the material can also be posted with reference to the sales order number. Thus, the costs can also be directly assigned to the sales order even in Repetitive Manufacturing.
Assemble-to-order with Repetitive Manufacturing

Use assemble-to-order with Repetitive Manufacturing if several of the following points apply to your situation:

Production of the finished product is carried out in clear and simple steps.
The assembly is produced in a constant flow over the production lines.
Simple routings are used, or assembly can be carried out without routings.
The components can be staged anonymously at the production lines. The components are procured, for example, with KANBAN using consumption-based planning, or with the planning strategy “subassembly planning”.
You want to reduce the effort required for production control and backflushing.
Sample Scenario for Assemble-to-order with Repetitive Manufacturing

The production process is kept as simple as possible. There are only a limited number of production levels involved in producing the product. The number of components is relatively low, however, it is quite possible to produce a large number of finished products due to configuration options.
The components required for final assembly are selected via the configuration in the sales order and are staged at the production line anonymously. You can use the assembly order to carry out an availability check for the selected components. Components that are always readily available are excluded from the availability check by setting the appropriate indicator in the material master record. (order fulfillment center
The finished product is assembled without a routing and the operations are similar. The planning table in Repetitive Manufacturing provides the planner with an overview of the production rates. Here, the planner can also check capacities for the production lines and distribute the ordered quantities to the production lines with available capacity.
When production is complete, the goods receipt for the finished product is posted with reference to the sales order number – a special function exists in Repetitive Manufacturing for this. Once the goods receipt is posted, the goods are withdrawn for the specific sales order and the assembly order is deleted.
For the scenario described above, you can also work without using the planning functions of Repetitive Manufacturing. In this case, capacity planning is not carried out from the planning table in Repetitive Manufacturing, but instead, using the capacity leveling functions in capacity planning. However, you can still use the backflushing functions in Repetitive Manufacturing.

Why is Order Fulfillment Important

The road to fulfillment can take on very different forms depending on the type of business you run. If you are selling a physical product, the way to bring about fulfilling that customer’s needs is going to be very different from a less tangible service, such as a consultation.

But often so many moving parts mean that careful planning and organization is necessary. Having a well outlined and smooth order fulfillment process will help your business continue to draw customers and satisfy them with your products.

Order fulfillment will look a little different for various business types. Here are a few different examples:

1. Make-to-Stock or Built-to-Forecast

This model builds a product against a sales forecast, and sells to the customer from the finished goods stock. This is most common among grocers and retailers.

2. Assemble-to-Order

The product is built to customer specifications from a stock of existing components. So while the item is built to suit the customer, the parts created are the same.

3. Make-to-Order

This model allows customers to purchase products that are customized to their specification. The manufacturer only creates the product once the customer places the order.

While how you go about fulfillment will vary based on your business needs and the type of product you sell, it is probably one of the most important ways you can keep your customers happy and coming back for more. And happy customers mean business growth.

6 Important Elements of Supplier Integration

  1. Get the news out early: No-one likes surprises. The earlier you can let suppliers know that a change is coming, the more time you have to hear their concerns and address any challenges that they anticipate. For new suppliers, make sure that you have a clear and realistic timeline for onboarding that they can be handed on day one for review and response.
  2. Request feedback at every step: The best-laid plans of mice, men, and supply chain managers often go awry.” Not all of those parties are included in Robert Burns’ classic quote, but there’s no doubt he would have included our profession after a few days on the job! Trust the integration plan that you’ve formulated for step one, but understand that it will require revision. Asking service providers for their input at every stage helps to improve that plan and increase supplier buy-in.
  3. Don’t overcomplicate the process: There’s always the temptation to use the latest technology and advanced systems to keep track of intricate processes. These can be beneficial, even crucial, in some scenarios, but often it’s the simplest solution that proves to be most effective. Focus on efficiency and ease of use before you adopt a new system, both to maximize understanding and minimize supplier frustration.
  4. Set expectations (and stick to them): It’s important to consider feedback from service providers, but it should never fully dictate the choices you make. The final decision of the systems you adopt – and setting appropriate service levels – should serve your business, first and foremost, only adjusting to supplier requirements when it has no negative impact on your organization.
  5. Don’t bite off more than you can chew: If you use multiple service providers, try to avoid bringing them all over to a new way of working at exactly the same time. Unless you have the resources to ensure a dedicated contact for each supplier, prioritize them into different tiers and bring each group aboard in manageable batches. The same goes for bringing on new suppliers. If you anticipate a glut of new providers coming online in a short period of time, try to stagger the process to avoid taking on too much all at once. (order fulfillment
  6. Set regular reviews and training schedules for the first year: With every project, there’s a temptation to move on to the next job when the primary objective has been achieved. That cannot be the case with supplier integration, where ensuring understanding and compliance is central to success. Your onboarding plan needs to extend beyond the agreed go-live date, setting up monthly reviews in the early stages, allowing for more feedback, adjustments, and making additional training resources available where they are required.

ChinaDivision: How to Increase Supply Chain Visibility

In our “now” economy, consumers demand real-time visibility, along with the near-immediate delivery of goods. This has created a great deal of supply chain disruption, causing businesses to reevaluate the way they operate. ChinaDivision, a professional and experienced order fulfillment giant, provides tips on how to achieve end-to-end visibility, and ultimately ensure a more efficient supply chain.

1. Start with the experience. Begin by defining what visibility means to your end users/customers, what kind of experience you want them to have, and what you want to gain from increased visibility.(order fulfillment )

2. Select a platform for connectivity. Your digital platform should connect key players. This means ensuring the platform is technologically agnostic and all intended parties can easily access it.

3. Attract the right talent. New technology enables both new processes and new talent. Recruit people who are analytically inclined and highly skilled at interpreting data.

4. Manage and standardize data. Having a clear data strategy is imperative. Cleansing and defining consistent data models allows you to consistently utilize and translate the data into meaningful information.

5. Trust the information. It’s critical to believe the data. You must trust the information, its security, and the entities you exchange information with. Find ways to confirm confidentiality and ensure security around the financial exchange of information.

6. Interpret and leverage figures. You can’t find ways to improve until you know what problems to solve. Data allows you to proactively manage exceptions before they occur, saving your business time and money while keeping customers happy.

7. Drive efficient decision-making. Once you discover opportunities for improvement, you have to respond to those needs. Now that you know where everything is across your supply chain, you can execute solutions.

8. Focus on real-time transparency. The frequency and size of data exchange is dramatically increasing at an accelerated rate. Being able to leverage this data in real time is imperative. The key enablers consist of understanding what data is most critical to solving key business problems, what it means, and what to do when exceptions occur.(order fulfillment

9. Opt for a neutral integration platform. The ability to flex up or down, quickly adjust, and accelerate the development of new capabilities requires an Enterprise Integration Platform. This allows companies to easily integrate, regardless of the execution systems in play.

10. Develop an extended ecosystem. Assuming you can develop and own all these capabilities offers a false sense of security. Today’s new digital environment requires a collaborative approach to managing your supply chain. Developing an extended ecosystem that brings the best of all your partners’ capabilities into a single environment is vital.

Key eCommerce Takeaways From 2018

With 2018 recently passing, it’s a good time to look back at the past year and the ways ecommerce order fulfillment and shipping has changed. There is no doubt the online retail space is evolving fast as the pressure for faster and cheaper delivery continues to shape the industry. Online retailers and carriers alike are working hard to adjust to the demands of this new, dynamic marketplace and the sky-high customer expectations that are part of retail today.

With the ever present pressure to cut costs from the supply chain, many retailers are focusing on better inventory management. Gone are the days of bloated inventories and allowing large amounts of capital to be tied up in unsold goods. Retailers have figured out the importance of staying lean as not just a way to lower overall costs, but the best way to keep inventory turning in their store.

Another thinking is, online retailers and other shippers have become much more open to considering alternative carriers and types of shipping solutions which has made them less beholden to any specific provider. Many shippers are willing to rate shop carriers with the attitude that service will always be about the same. In other words, price trumps concerns over service. This is in large part a response to the pressure many feel to offer free or low cost shipping on customer orders.

Last but not least thing is, now that dimensional pricing has been in place for some time, the effect has been digested by the marketplace allowing shippers to better understand and react to its impact. Most have felt it on their bottom line and are figuring out ways to respond. The first thing many are doing is looking for ways to minimize packaging and take every opportunity to trim size and weight as a way to maximize the utilization of space.

 

 

 

 

 

How to Plan Your Order Fulfillment Before Holiday Season

There are many reasons to outsource order fulfillment during the holidays. Waiting too long to look for a cost-effective order fulfillment solution is a dicey proposition. The best option is to seek out a company that can meet or exceed your expectations rather than waiting and potentially incurring penalties later on. You’ll be thankful you planned ahead—and the gains your business makes will be even sweeter.

Here are six reasons why you should plan your holiday fulfillment now.

To Manage Inventory

The first big hurdle around seasonality is the volatility of managing inventory. The combination of a massive influx of customers, hot items and huge sales can deplete stock very quickly, so even when factoring in the lead time needed for replenishment, being able to fulfill your inventory needs well in advance is critical. This goes for e-commerce as well as for brick-and-mortar stores.

To Manage Customer Expectation

A customer who can’t find that special item they’re looking for will simply visit your competitors next door. Aside from causing them disappointment, you may be losing future business from them, which you may never win back.

To Maintain Customer

Loyalty If you don’t manage your customer expectations, it could also lead to lost sales. Out-of-stocks, overstocks and returns are costing retailers over $1.75 trillion according to a study by the IHL group.

To Acquire New Customers

The holidays also bring a rapid influx of new customers. If they have a great experience with your brand, there’s a huge chance that they will return, thus increasing your market share.

To Reduce Fulfillment Errors

What about “Murphy’s Law”? A greater volume of merchandise moving between stores means dealing with a whole lot more moving parts. If there are errors in fulfillment, this places an additional cost on you that can be multiplied many times over during the ultra-busy Holiday sales period.

To Keep Things Running Smoothly

The ultimate purpose of beginning planning for holiday order fulfillment right now is to keep everything running smoothly as possible, thus providing a seamless experience for customers.

3 Strategies to Speed Up Your Order Fulfillment Process

When it comes to speeding up order fulfillment, there are some steps you can take to make a big impact. Start by looking at some of the “quick wins” that don’t require a massive investment, but will make a quick difference, such as classifying your inventory and ensuring that it is stored as logically as possible. The next step is to make sure that you are making the most of the systems you already have in place. Many companies have the pieces in place that are needed to improve their order fulfillment processes, but are unable to get the most from these systems.  Finally, you can also look at making new investments in automation to speed up your order handling times.

 

  1. Classify your inventory to ensure rapid handling: Grouping your inventory from fastest moving to slowest moving helps to ensure that you always have the right stock levels on your most important items. Put the most popular items in a centrally located area of your warehouse to ensure that they can be picked, packed and delivered to the shipping dock in a minimal amount of time. Slower moving items can be stored in a separate area. This more logical arrangement can really cut down on the time it takes to process and fulfill orders.
  2. Integrate systems for more visibility into all aspects of order fulfillment: In order to quickly fulfill an order, you need visibility into several areas––demand forecasting, sales, inventory, and logistics just to name a few. At a minimum, this requires some level of integration between the sales order management system where the order is placed, and the ERP system that maintains financial data, as well as the inventory and logistics systems that that handle the processes for picking, packing and shipping.
  3. Automate processes: After your systems are able to provide more visibility into all aspects of the process, you should also look at how the processes themselves can be sped up. Automation doesn’t necessarily mean investing in robotics or conveyors, it can be as simple as investing in scanners to more easily enter inventory into the system as it arrives in your warehouse, or scanning it out as it leaves. And for smaller businesses, the investment doesn’t have to be huge. There are even applications that can be downloaded to a smart phone or tablet to automate this process inexpensively.

What You Need to Do Before Outsourcing Your Order

Many fulfillment services guarantee high levels of accuracy and shipping within 24 hours, yet it is important to recognize whether these promises are supported by their policies. For top fulfillment companies, mistakes are rare, but they can happen, and you should be prepared. For example, how will the fulfillment provider compensate you for a late shipment, an order sent to the wrong address, or broken merchandise? Will they pay for the shipment in full? Will you have to fill out paperwork to get a refund, or will the fulfillment company automatically credit your account?

Another thing to investigate is the culture behind the order fulfillment company https://www.chinadivision.com. Find out if they promote a culture of pride in excellence, or if they have more of a “we’ll deal with it when it happens” attitude. Ask them how, internally, they measure the performance of their customer support staff, warehouse supervisors, and their teams. It should be clear that fulfillment providers who actively provide incentives for customer responsiveness and thoroughly examine their own mistakes are more committed to quality than those who do not.

Benefit From Outsourcing Your Order to An Order Fulfillment Company

Packaging and shipping your own orders can be expensive. Costs such as warehouse space, employees and machinery must be considered when fulfilling orders in-house. Considerations such as these are why many businesses choose to outsource their order fulfillment. With an order fulfillment company, businesses are able to save money due to more flexible staffing options, experienced and efficient packing, as well as cheaper shipping costs. Cutting in-house costs and stress frees up more time for your business to focus on what is important in-house.

Benefits of outsourcing include more than just cutting costs, they also include cutting the amount of resources necessary for running an in-house shipping operation. Outsourced fulfillment means no need for your own warehouse staff, warehouse space, packaging and the list goes on. Outsourcing may seem intimidating to some, but the benefits far outweigh the downfalls when you choose the right order fulfillment company for your business’ needs.

Confidence in your choice of order fulfillment company provides you with the assurance that business is being taken care of without you having to do all the work by yourself. Utilizing an outsourced fulfillment company for your product fulfillment needs provides helpful resources for your business to grow and flourish. Exploring your options for order fulfillment can be exhausting, but it doesn’t have to be. Know who the best in your industry is and then evaluate if their solutions could be your turn-key.