Tag Archive for: e-commerce

Increased Volume of E-Commerce Orders

Challenges Caused by an Increased Volume of E-Commerce Orders

According to Digital Commerce 360, e-commerce, as a portion of total retail sales, rose 44% in 2020, triple the rate increase of sales over the prior year. While the result has been increased convenience for consumers, warehouses, fulfillment centers, and distribution centers are looking to overcome challenges associated with that dramatic shift in consumer behavior.

Some are looking at building new facilities dedicated to fulfilling these types of orders. Others are looking to design and technology solutions that can help them meet the unique demands of their current facilities. Either way, they are seeking to resolve fulfillment challenges that are resulting from the rise of e-commerce.

With massive change in consumer behavior underway – and more change to come down the road – let us take a closer look at each of the significant pain points caused by the rapid increase of e-commerce on the supply chain.

The most accessible place to start in examining common challenges to facilitate more e-commerce orders is in the facility’s design. Warehouses are reaching storage capacity for their original intended design and function. After all, many warehouses were built to sustain and maximize full pallet orders. Now, there is a requirement to facilitate a more significant share of e-commerce orders, which means they need to react to higher order volume and store a wider variety of SKUs.

There are also inherent design hurdles to overcome regarding where – and how – the products are stored and retrieved. For instance, the warehouse goes from storing pallets and cases in static racking, where employees are driving powered equipment to travel to a location, pick a pallet or case, take it to a shipping area, and send it out the door. Now, they need to make individual products accessible, typically available at the floor level, and make it easy for someone to pick either a unit or multiple SKUs for an order.

They need to mold their processes to move from case-or-pallet picking to include the each picking required by e-commerce. In that transition, they are learning that it is very different to pick individual products.

With each picking, the process for fulfillment is nearly double the number of steps compared to case-or-pallet selection. Forklift retrieval for full pallet or case picking, where a high volume of a single product can be moved and shipped – process warehouses have made efficient for decades.

For a higher percentage of orders, workers must now pick, consolidate, pack, and then ship orders, all while customers are demanding their products be delivered more quickly than ever. Now operations will need to establish a consolidation process, packing process, and shipping process.

After all, e-commerce orders are requiring these businesses to double their processes. Are those processes optimized? How are they integrated with the full pallet orders? What tools are available to help with the transition?

Those are all reasons why the operational cost of fulfilling a single order for e-commerce is higher than that of a pallet or case order. Distribution centers and warehouses are already under increased wage pressure, and now they need to integrate these new, increased operational expenses that chip away at their bottom line.

In addition, the costs for labor rising are not only the costs for labor, but the availability of reliable labor is a real challenge that warehouses, fulfillment centers, and distribution centers are all facing. Whether it is due to the COVID-19 pandemic or other external forces, absenteeism is growing in this sector.

Combine all the above, then also factor that we are amid a labor shortage in the supply chain industry, which in part arose due to a sharp rise in demand for trained workers, among other external factors.

What Challenges Are You Experiencing?

What other challenges are you experiencing as a result of the rise of e-commerce? There are emerging trends that dynamic operations respond to, but we understand that each fulfillment center has its unique challenges, and we are here to help.

To adjust to the challenges caused by a rising share of e-commerce orders, a similarly increasing share of distribution and fulfillment centers are investigating adding automation, technology, and dense storage solutions. Autonomous mobile robots, automated packing solutions, and goods-to-person picking solutions all have applications to combat the challenges caused by the higher order volume and can be implemented without requiring an investment in costly infrastructure. These solutions also help relieve high labor costs and labor reliance while helping drive throughput and speed in the fulfillment process.

We have multiple partners who can provide solutions to these challenges in introduce increased labor efficiency into your operations. Our team has years of experience designing an ideal solution based on your data and our years of expertise.

Rising Share of E-Commerce Orders

3 Tactics to Adapt Your Facility to Rising Shares of E-Commerce Orders

In 2017, e-commerce orders represented about 10.4% of total retail sales, according to a study conducted by eMarketer. In 2021, that number jumped to 18.1%. That same study estimates that by 2023, more than 22% of total retail sales are facilitated online. With that massive jump in a relatively short amount of time, warehouses, distribution centers, and fulfillment centers across the supply chain are reacting and adapting their practices to accommodate this rising share of e-commerce orders.

Traditionally, warehouses have long been configured for pallet-in and pallet-out for shipping orders. However, both e-commerce orders and direct-to-consumer fulfillment require a completely different picking and packing process. These processes are more expensive for fulfillment centers that don’t have systems to handle e-commerce orders because they need a lot more human capital and labor cost.

While facilities are making changes to adapt to the e-commerce and direct-to-consumer explosion, some are left behind, wondering what the best course of action is for their operations. While each operation is unique, businesses can take a few actionable steps to adapt their existing facility to accommodate an increased level of e-commerce.

Tactic 1: Create a Forward Pick Area

According to Warehouse Science, a forward pick (or fast-pick) area is “[an area] from which it is most efficient to pick, but which must be restocked from a reserve or overflow or bulk storage area.” Essentially, you treat your static storage media as “reserve storage” and move specific products to a storage area, from which most of your orders are picked. This forward pick area needs more frequent replenishment than the reserve storage, but the flip side is that orders can be fulfilled more quickly.

The products stored in this area need to be the appropriate SKUs & stored in the proper storage medium based on the cubic movement of the SKU. If you decide to use the most ordered SKUs, they need to be stored in a larger storage medium to avoid excessive restocking of the forward pick area which could cost some of the efficiency you gained by creating this dedicated storage area.

Typically, the best practice is to use a warehouse execution system (WES) or workflow optimization software to determine the best SKUs to minimize your labor costs. Our team of experts has decades of experience matching the right software for your unique needs with our agnostic approach to vendors and partners for our clients.

Tactic 2: Evaluate New Storage and Picking Methods

Another way to adapt to changes caused by an increased level of e-commerce orders is to add systems and capabilities that allow for batch and zone picking. Vertical lift modules are a goods-to-person solution that can take small-sized products, store them in a high-density, low-footprint storage system and deliver them to pickers, who then assemble orders on a cart or take them to a shipping area.

Zone picking is good for multi-line orders because it reduces travel time for pickers, and autonomous mobile robots (AMRs) are another goods-to-person solution to assist in these efforts. At a high level, AMRs can take the walking/travel element out of the picking process by moving the products from storage to a given location, be it a packing station, a conveyor system, or just to an employee, who can then pick the items & package them together.

To a more considerable degree, automated storage and retrieval systems (AS/RS) or other automation solutions that support goods to person picking can also reduce travel time and create more dense storage. However, these will generally come in at a higher initial cost than the AMR solution, which can be integrated without affecting your existing infrastructure.

Tactic 3: Automate Packing Processes

E-commerce and direct-to-consumer orders usually are not pallet-sized orders; they are parcel-sized orders. So, when a facility is accustomed to shipping pallets, how do you adopt best practices for these smaller orders? If the order is a single-line order, you could probably have the shipping team place a label on the item & ship it. However, what happens with multi-line orders?

Automated packaging solutions exist that can accommodate a wide variety of consolidating and shipping multi-line orders. They can also accommodate potential requirements like polybags, dunnage, airbags, Styrofoam peanuts, and various other materials to keep packages safe from damage. By automating these processes – from right-sizing packages to physically loading trucks – you save a sizeable amount of labor costs that were not needed in a pre-e-commerce world.

Where Do You Go From Here?

If you have seen an increase in each or case picking, then give us a call. Whether you are adapting your current facility to account for increased levels of e-commerce or your manufacturing partners are considering a more direct-to-consumer strategy, having the capability to meet your customers’ expectations on fulfillment time and accuracy is essential. We would recommend starting at the design stage and finding a partner that understands how to optimize material flow and storage media. Of course, Storage Solutions has a team of experts on staff that can assist with these challenges.

Contact us today, and we can talk through your challenges, identify some quick wins, and formulate a plan of action. We may suggest dense storage, automation, or some other process-related plan built for your business. Depending on your needs, we may help without a site visit, but we may suggest one as well.

Either way, we should talk. Give us a call today!

Early Supply Chain Trends 2021

Three Early Supply Chain Trends We Are Seeing in 2021

Among the most valuable lessons we have learned from a chaotic 2020 is the premium an organization can place on being proactive. Between COVID-19, natural disasters, and the typical peaks and valleys of a fiscal year, many learned the value of planning for the unexpected, recognizing trends early in their lifecycle, and the importance of having a “Plan B” when things go awry.

While the dust is still settling on the impact that significant changes created – or accelerated – in 2020, we see several significant themes emerging early in 2021. Between our own experience and learning the challenges our partners are seeing, and how we can potentially help you see the same challenges.

Challenges with Sourcing Materials

According to TheFabricator, the combination of increased demand and a tightened supply line has caused the price of steel to soar and caused longer lead time for manufacturers. Some have even had issues hitting their delivery dates because of the rising prices or limited availability of raw materials. What happens when your vendor calls to tell you they cannot meet a delivery date because of the steel market’s wild swings? When it comes to planning projects, it portends the importance of being flexible and having contingency plans. We like to take a proactive approach with our clients and plan for the unexpected.

A Rapid Response Required for E-Commerce

Customers are expecting faster & faster delivery as time goes on, and fulfillment centers have long been searching for processes that can assist in meeting those needs. However, the expectations have rapidly increased in conjunction with our nation’s response to curbing the spread of COVID-19. DigitalCommerce360 reports that e-commerce rose 44% in 2020 compared to the year prior, causing companies to shift their business model to accommodate a higher volume of smaller orders. How are they going about doing that? Are they looking for short-term solutions or thinking holistically about flexible, scalable solutions to prevent disruption in the next supply chain crisis? We caution those looking for the former to consider the latter, and we’d love to help you as you address these issues.

An Increased Number of Labor Challenges

As COVID-10 continued – and continues – to spread throughout the US, managers have seen an increased absenteeism level in their workplace. Some companies have moved to flex-or-remote working environments, which causes companies to increase cross-training and job sharing among their employees. After all, work has to continue even when there is a reduced labor force. So, as we advance, how do you make those roles more efficient? How can they be simpler to allow the same amount of work to happen (if not more) with less training? Should automation be an option in some areas? For an increasing number of fulfillment centers, automation is becoming an effective measure against variances caused by labor challenges.

There were many lessons learned in 2020, especially in the way companies respond to disruptions. The early trends we see in the supply chain continue to show that companies need to be flexible in their operations and proactive in planning to mitigate against potential disruptions. There will always be disruptions, so why not get ahead of them?

Proactive Planning

While we cannot say we’ve seen it all – or maybe now after a nearly-year long pandemic, we can – we certainly have experience against long lead times, volatile pricing, introducing automation, solving labor challenges, and meeting customer demands as they continue to change.

From the beginning of our project, our partners know that we are upfront in recognizing where projects could experience turbulence and potentially get off-course. By being proactive and transparent, we build trust in our clients because acting on that “Plan B” in the event of an unforeseen disruption is so much more useful than coming up with one when the problem arises.

When a project comes along, and you need a partner to help guide you through the parts of a project you know will happen, keep in mind you may need someone to help guide you through the unforeseen, impossible-to-predict aspects. With our simple, smart, and strategic approach, we are here to help!

Storage Solutions Each PIcking E-Commerce

5 Storage Solutions to Support Each Picking & E-Commerce

“Each picking” is a common style of order picking in the rising world of order fulfillment through e-commerce channels. With each picking, individual products or SKUs are selected from a storage medium instead of choosing an entire case or pallet. Once the order is complete, the picker transports the order to a packing area to be shipped.

Especially at a high volume, this process can be relatively highly labor-intensive, add to rising labor costs, and potentially cause delays in order fulfillment. Plus, because order sizes are getting smaller – in line with a rising share of e-commerce orders – warehouses and distribution centers need to be aware of various storage solutions that support each picking. This knowledge is particularly valuable as we continue to adapt to a rapidly changing supply chain.

light-duty-cantilever

Cantilever Shelving

So, which storage solutions allow for your warehouse to be best equipped to facilitate each picking?

  • Cantilever – Cantilever arms can be attached to pallet rack uprights and be outfitted with wire decks to keep products like clothing and other soft goods within a multi-level system from a picking perspective. This configuration can make continuous picking and replenishment easier for workers. Cantilever shelving can also be utilized as a creative way to put small-cube and slow-moving objects on a shorter pick path.
  • Carton Flow – Primarily used in first-in, first-out picking situations, carton flow uses gravity to feed products forward from a rear-load design. When an item is picked, the next case or object with the same SKU moves forward with gravity’s help to the pick face. This style of racking is designed for high-volume each picking where you need to keep operator travel low.
  • Spantrak Carton Flow

    Carton Flow

    Hand-Stack Racking – Similar to cantilever shelving, hand-stack racks are traditionally used for storing products that may be too bulky or large for standard bin shelving. This racking style generally uses wire decking or a solid surface to act as shelves within selective pallet rack with variable heights per row to best fit products in cases or cartons.

  • Modular Picking Carts – Modular picking carts are great accessories for pickers as they fulfill an order. They can accommodate and organize the storage of one (or a few) products of several SKUs, a regular feature of e-commerce orders. These mobile carts can also be configured to be either single-sided or facilitate back-to-back storage, depending on your products’ sizes.
  • Vertical Lift Machines (VLMs)
    vertical-lift-machines

    Vertical Lift Machines

    – The primary benefit of a VLM is the maximization of vertical space in your warehouse. For instance, a VLM may be capable of storing the same amount of small cube items that take up 5,000 square feet of floor space in a warehouse and transfer that into about 150 square feet of floor space, giving you a 90% decrease in your footprint. This goods-to-man solution allows operators to pick orders accurately and efficiently at a high rate by delivering products in trays controlled by your already-existing Warehouse Management System (WMS).

Which Solution is Best for Your Facility?

For the most part, determining which storage solution is right for you depends on the size of the products stored in your warehouse and how quickly your orders need to be fulfilled. However, that time keeps shrinking due to changing customer expectations.

Having an expert by your side can help determine the best answer, especially if you are looking at adjusting pick processes, facility layout, and storage optimization.

Of course, our team is here to help! We would love to get a conversation started around the challenges you see in meeting customer expectations, rising labor costs, and storage needs. With our “simple, smart, strategic” approach, we can develop the optimal solution to meet your needs. Give us a call today!

Why Storage Solutions C-A-R-E-S For Your Warehouse Design

Why should the Storage Solutions C-A-R-E-S warehouse design optimization process matter to your company? Everyone experiences challenges & changes within their operation. With the Storage Solutions C-A-R-E-S process, we follow a systemic approach to uncover any issues you may have. These guidelines allow us to address specific opportunities for improvement, pain points, growth objectives & more. We have tailored this process to be fully customizable to fit your budget, needs, and time frame.

For example, we can address issues you may have when it comes to order fulfillment. The cause could stem from picking challenges or e-commerce and omnichannel fulfillment demands. For this reason, it is imperative to design a solution that works best for you and is dynamic enough to adapt at the drop of a hat to meet external expectations.

Likewise, internal issues such as SKU proliferation or facility consolidation may be items that need to be addressed. Our C-A-R-E-S process can analyze these issues to provide you with the most efficient answer to your current problems. Similarly, we provide you with the most flexible solution to ensure you are ready for any changes down the pipeline.

In conclusion, by using our data-driven C-A-R-E-S process, we can help you create a solution that can be justified not just operationally but also economically. By developing your distribution to optimal efficiency, we can address your current and future goals. Our team of material handling professionals and our in-house design team make the perfect tandem to prepare you quickly for market changes and increased customer demands.

Now that you know why an optimized warehouse design is essential, you can learn more about our C-A-R-E-S process here!

Temperature Controlled Storage

The Rising Need For Temperature-Controlled Storage

Temperature-controlled storage is a subject that is getting significant attention lately, and for a good reason. It is integral to the storage and supply of climate-sensitive items such as food, pharmaceuticals, and similar items. If these items rest for too long in the wrong climate – without temperature-controlled storage – they could be damaged or ruined. Of course, that loss of inventory the last thing anyone wants for their business.

The growing popularity of e-commerce, also known as the “Amazon Effect,” brings with it the need for more temperature-controlled storage space in warehouses and distribution centers across the globe. Citing a 2019 report published by Los Angeles industrial retail giant CBRE, experts anticipating an expected expansion of more than 30 million square feet of cold storage by 2024. The demand for these types of facilities is “niche, but one that is really going to take off,” according to the CRBE.

Temperature controlled space can be costly to construct and operate. Common challenges also include creating a design that is optimal for employee working conditions, safety, and maximizing storage capacity within the cubic space available.

When going this route for your company, you will want a partner that can give you the exact solution that meets your needs. By working with our expert design team, you can rest easy knowing you will get optimal utilization out of your facility. Our priority is to make sure that not only are your needs met but that your project is also completed on time and on budget.

Available Solutions for Temperature Controlled Storage

  • Drive-in Rack
  • Pushback Rack
  • Semi-automated deep lane storage system
  • Fully automated, cart-based AS/RS system
  • Dense storage methods with “pick tunnel” designs incorporated to accommodate case picking
  • Carton flow rack for case pick items
  • Vertical Lift Machines (VLMs) for each pick items
storage solutions omni channel

The Omni-Channel/E-Commerce Storage Experts

The world of E-commerce/Omni Channel is popular. Very popular.
You’d have to be living under a rock not to notice the trend of online ordering over the past decade, but you may be surprised to know how popular it’s really become.
In 2014, Amazon became the first top-ten US retailer without a bricks-and-mortar store. It’s also averaged 30% growth since 2006. Pretty impressive, but they’re not alone.
In the US, online-only retailers are outgrowing their bricks-and-mortar colleagues by more than 62%.
This coming of age has brought new heights of choice and convenience to the consumer, but has wrought havoc and headache for distribution centers that have undergone major change to keep up with them.

Read more