The most important facet of businesses that sell products is the process of actually getting those products to their customers. If you own a retail store, this isn’t much of an issue — your customers can simply grab what they need right off of the shelf. But if you ship your products, it’s a whole lot trickier. This is why streamlining your order fulfillment processes is so important.
The accurate and on-time delivery of your products is essential to growing (and simply maintaining) your company. No customer, whether B2B or B2C, will tolerate orders that consistently arrive late or without the right products. They’ll just switch to one of your competitors without a second thought.
With this in mind, you should always strive for a perfect order fulfillment system. Nobody claimed it was easy, but as the saying goes: nothing worth doing comes easy. There are, however, five strategies you can use in order to streamline your order fulfillment processes.
What are those five strategies? We’re glad you asked:
1. Maintain Inventory Accuracy
Ever ordered a product online only to find out that it’s out of stock, and you won’t get it for several weeks or months? It’s frustrating, isn’t it? If this happens to your customers, you can guarantee that your customer satisfaction will suffer. That’s why inventory management is so crucial to streamlining the order fulfillment process.
Maintaining inventory accuracy is important for both your customer-facing systems and your internal ones. As we just mentioned, updating your inventory count in real time ensures that your customers can’t order products unless they’re in stock. At the very least, they should see a message indicating that the products are out of stock before they make the purchase. This is just good customer service.
As for your internal systems, real-time inventory management helps you manage your fulfillment warehouses. This allows you to keep tabs on the inventory levels of your various products, helping you decide if you need to ramp up your production of those products or decrease it. After all, one of the more difficult aspects of managing warehouses is what to do with excess inventory, so you need to reduce it as much as possible.
Lastly, if your online store doesn’t allow your customers to purchase out of stock products, it’ll help keep your order fulfillment software a little less cluttered. In other words, you don’t have to manage future orders of products; you only have to worry about fulfilling customer orders where every product can be shipped right away.
2. Implement Slotting Optimization
This strategy is far from easy, but also one of the most useful. Slotting is all about managing the picking processes in your distribution centers. According to Material Handling & Logistics (MH&L), slotting is “The process of determining where items should be placed in the picking area so that the popular items are stored close together and in close proximity to the starting point of picking so as to minimize walking time.”
Slotting optimization, then, is the process of storing your products in the most efficient manner possible in order to make picking easier. This includes placing the most popular items closer to the picking area, but spacing them out well enough so it doesn’t get congested. In addition, placing these popular items at a height where pickers don’t have to bend down or reach up helps speed up the process.
MH&L goes on to discuss another key aspect of slotting optimization: storing and picking items in relation to size, weight and general fragility. As you can probably guess, the most fragile products need to be picked last so that they’re packed last and won’t get crushed by heavier items. Therefore, more fragile items need to be stored in an area where they’ll be picked last.
3. Integrate With Your Suppliers
Very few online retailers actually manufacture the products they sell. This means that there’s at least one other company — and probably more — that you rely on to fill all of your customer orders. This results in a lack of both data and general knowledge of what happens with your third-party logistics. For example, you might not always know when your manufacturer experiences a hold up. On the surface, a brief hold up may not seem like a huge issue, but it could lead to late shipments and dissatisfied customers.
So how do you fix this issue? The best way to do so is to integrate with your suppliers. This requires software that can share data between you and your suppliers, so you can keep tabs on the day-to-day operations related to your products and shipments.
Additionally, integration helps reduce and/or eliminate miscommunication problems, such as billing errors. As CommerceHub describes: “A best-in-class platform integrates your suppliers’ [order management system] with your own so that missed orders, endless supplier coordination, invoicing errors and other such aggravations become things of the past.”
4. Add a Smart Warehouse System
Smart warehouse systems are becoming increasingly commonplace in today’s warehouses. As we described in our original smart warehouse systems article, “Similar to a smart home, a smart warehouse is enabled with several automated and interconnected technologies. These technologies work together to increase the productivity and efficiency of the warehouse, minimizing the amount of human workers while decreasing errors.”
These systems include several technological components that automate the warehousing process, in turn making your order fulfillment more efficient. Some of these technologies include robotics, radio-frequency identification (RFID, a digital version of a barcode that uses radio waves), AI, the Internet of Things and warehouse management systems.
How do these technologies work together to streamline order fulfillment? Let’s look to the slotting and picking processes as examples. When fulfillment centers receive a shipment of products, RFID scanners scan the tags of each item, automatically updating the inventory levels. Robots take over from there, storing those goods so they can be picked. Later, different robots help pick those items and bring them to a packing area so they can be shipped.
The use of this technology reduces not only the number of human errors (especially related to counting items), but also the time it takes to store and pick all of those products. Plus, this reduces the need for human workers to perform all of these duties, which reduces your order fulfillment costs and shipping costs in the long-term.
5. Improve Supply Chain Visibility
The last strategy that can help streamline your order processing is improving the visibility of your supply chain management. Supply chain visibility involves tracking production, product orders and shipments in order to gain insights throughout all of your supply chain operations. In simpler terms, it’s the ability to collect data throughout your entire supply chain.
When you improve supply chain visibility, you can find powerful insights into what may be hurting your order fulfillment processes. For example, you may find that consistently late workers slow down production at a certain facility. Or you could discover that your shipping vendor uses sub-optimal routes, slowing down your fulfillment services.
There’s no telling what you can find out about your order fulfillment until you improve your supply chain visibility. But once you do find something, you can take adequate steps to fix it. This way, your order fulfillment process will run smoothly, saving you time, money and a whole lot of customer service headaches.