Maximizing fulfillment efficiency is an ongoing process and a major goal of every successful warehouse operation, particularly in a consumer landscape shaped by the impacts of the COVID-19 pandemic.
Consumers have increasingly turned to eCommerce for their purchasing needs, and understandably so, as they sought to avoid spaces where virus exposure was a risk. As such, the shift from shopping brick-and-mortar to digital has accelerated by almost five years – with both orders and returns experiencing a significant boom.
To keep pace with these changes, warehouse managers must identify opportunities for growth in both their fulfillment & reverse logistics processes and implement optimizations that achieve speed and efficiency. Let’s cover some basic ways that fulfillment efficiency can be maximized to meet consumer demand.
Investigate layout redesign
The simplest and most foundational place for warehouse managers to start is by assessing the warehouse layout itself. The value created by other optimizations can be hampered significantly if the layout is inadequate, therefore it’s important to prioritize improvements here first if possible.
When rethinking the warehouse layout, consider the typical flow of goods, people, and equipment through the facility – especially if those flows have changed recently due to shifts in other parts of the supply chain. Even small inefficiencies incrementally stack up to wasted time, labor and money. An updated map of the warehouse can be useful to help visualize movement flow and assist in identifying effective change opportunities.
The layout should also be assessed for optimization opportunities, beginning with defining or even redefining the requirements you are working within. Does the current arrangement fit these needs? If not, where might the system be enhanced for greater efficiency? While warehouse capacity fluctuates, operators should take a hard look at their basics and get the most out of their layout in order to stay competitive and maximize performance.
Increase inventory visibility
Faster order fulfillment times are made possible when inventory visibility is heightened, so optimizations that focus on digital transformation in this area often have significant impacts on overall performance. Radio-frequency identification (RFID) tags or other IoT devices are an effective way of achieving this aim.
When inventory is managed using IoT devices transmitting real-time data, picking and stocking efficiency can be significantly increased. Additionally, inventory levels can be more dynamically controlled, and automatic triggers can be enabled to ensure stock levels match demand more closely.
IoT devices like RFID tags or smart shelves aren’t exactly new tech, but adoption continues to lag behind need in many cases. A recent study into retail tech reports that 30 percent of retailers are making supply chain upgrades to RFID or have plans in place within the next two years.
Furthermore, 17 percent of retailers from the same study indicate intentions to realize real-time inventory visibility within the next year. Smart warehouse operators should be focusing on this area if they aren’t already before it’s too late to catch up to their competitors.
In addition to increased engagement with IoT technology, the pandemic has sped up the adoption of more sophisticated technologies like warehouse robotics. Statista reports the warehouse automation market is expected to hit approximately $15 billion globally in 2021 (an increase of one third in five years), climbing up to just over $30 billion by 2026.
Interestingly, as of 2016, only 10 percent of warehouses operating in the U.S. were using automated technologies. This demonstrates an enormous opportunity for warehouse managers to enhance and expedite operations through robotic automation.
It’s important to highlight that COVID-19 isn’t the only reason to look towards robotics and increased automation. The Amazon Effect, described as the retail disruption caused by the giant’s influence on increased commerce, has raised consumer expectations so high it seems the only way to compete is through automation.
Services such as Amazon Prime entice people to buy more, more often with the expectation that they’ll receive free, same day delivery. It’s no wonder the average retailer is looking for ways to speed up their supply chains and offer same-day service. With the help of robotics, fulfillment times can keep up with high expectations.
COVID-19 has presented a number of challenges in keeping up fulfillment efficiency, however, smart warehouse managers can turn these challenges into opportunities to pull ahead of the competition. From optimizing basic warehouse layout to increasing inventory visibility, and even stepping into the future with automation, there’s enormous opportunity for order fulfillment to gather speed in 2021 and beyond.