As the percent of online sale grows and as the line between web and traditional retail store fulfillment blurs, e-tailers and brands need to assess their fulfillment capabilities and those of their 3PL warehousing partners. Efficient omni-channel distribution will be a requirement, not a nice-to-have, in the very near future. Watch this video to see how KANE handles fulfillment for companies with multiple sales channels.
To make sure you are choosing the right distribution partner, here are 5 tips to consider.
1. Co-locate inventory for B2B and B2C channels and manage it using a single system.
By replenishing pallet, case pick and each pick areas from a single inventory pool, you keep your fulfillment costs, and your inventory, as low as possible. Maintaining your inventory on one system facilitates buy online/pick up at store -- the largest sales growth opportunity for retailers and brands.
2. Choose a partner that can offer flexibility and scalability
Some 3PLs are very good at regular, predictable fulfillment volumes, but they have a tough time managing unanticipated volume spikes without a disproportionate increase in time and costs. They may not have a good solution for temporary labor, or perhaps their systems aren't up to par. In omni-channel distribution, you need to be ready for anything, like flash sales from a QVC airing. Discuss this key requirement with prospective 3PLs until you have a comfort level with their process and capabilities to efficiently handle large volume swings in the fulfillment center. When demand is such that it requires expansion beyond the current footprint, can your 3PL scale with you and offer additional locations? The fulfillment industry is still dominated by smaller, single-location sites that may not be able to support your businesses as it grows.
3. Choose a partner with the systems for efficient omni-channel distributionParticularly for labor intensive pick and pack operations, you want to minimize labor costs. That requires smart systems, and not all fulfillment companies have made this investment. Advanced WMS systems like Manhattan will be able to:
- analyze and combine similar orders on the same pick cart to reduce picking costs
- automatically choose the right carton size to minimize shipping costs
- scan products as they are picked to reduce costs and improve accuracy