e-fulfilment driving Picking Accuracy?

Anyone can take a reservation (or Order)

When thinking of the perils of purchasing goods online, especially around the annual seasonal holiday peaks, one cannot help but worry, “will it arrive in time?” and “what if my wife’s present goes missing?” etc. etc.

One can only imagine the icy glances of disappointment over that special occasion lunch or dinner from one’s spouse should their token of appreciation and devotion not have materialised earlier that morning.

I then recalled a scene from “Seinfeld” concerning the reservation of a hire car when Jerry attempts to collect it …now bear with me….all will hopefully make sense……Ok….So,…it went something like this:

Jerry: I made an online reservation for a mid-size car.
Agent: I’m sorry, we have no mid-size cars available at the moment.
Jerry: I don’t understand, I made a reservation, do you have my reservation?
Agent: Yes, we do, unfortunately we ran out of cars.
Jerry: But the reservation surely keeps the car here? That’s why you have the reservation!
Agent: I know why we have reservations!
Jerry: I don’t think you do. If you did, I’d have a car. See, you know how to take the reservation, you just don’t know how to *hold* the reservation and that’s really the most important part of the reservation, the holding. Anybody can just take them.

Now many of you may be wondering at this point, what this has got to do with e-fulfilment …. Why are we taking a nostalgic trip down Seinfeld memory lane? Yeah, sure, it was a pretty good episode, granted, not as good as the one featuring Mr. Bookman, the Library Cop…. but still, pretty good.
That’s not it, though.

For “Reservation”, see “Order” or more importantly, “Order Fulfilment”.

Anybody can take an order on line, but the real “customer experience” does not end there. We and our logistics partners are being asked more and more to support our clients’ e-fulfilment operations offering multiple solutions in a seamless joined up and interlinked approach as the pressure is always being passed back down the supply chain.

“A record amount of online shopping was done in December 2013”, says the British Retail Consortium (BRC). “Close to one in five non-food items was bought online in December 2013”, according to the BRC survey. The figures represent a 19.2% growth in internet purchases from a year earlier, the fastest increase in four years. The dynamics of the high street have changed radically over the past ten years and continue to do so broadening out to encompass: online purchasing, catalogues, mobile devices, multiple delivery options, in-store pick-up, click & collect and latterly parcel lockers – as well as a widening choice of means for returning goods.

These figures demonstrate that businesses are not necessarily moving away from traditional models and solutions but looking to add e-commerce as an additional channel to market and revenue stream. Therefore it is imperative that real-time inventory visibility is available to these organisations, with the ability to allocate that inventory quickly in the most cost-effective way. This is even truer for non-asset based organisations that are not able to offer the “Shop front” experience like the “Amazons” of this world.

In this, not so new, brave new world, both Supply Chain service providers and their solution partners face a myriad of ever changing dynamic challenges. For example, in a B2C e-fulfilment model the margin for error is virtually nil, where as a “traditional” commercial B2B operation could be picking large multiple item orders of 100’s of items to a single recipient. And whilst we all have a goal to provide 100 % order fulfilment, the impact of a picking error here would not have a dramatic impact on the service level. A 99 % fulfilment in this scenario is largely acceptable. However, by contrast, B2C consumer orders are typically one, two item orders. A mispick here could represent either 50 % to 100 % failure, which to the consumer is understandably unacceptable.

This, coupled with the additional cost overhead of rectifying these errors by re-picking with the subsequent collection / re-deliveries, makes it imperative and critical that orders are picked accurately. We’ve all heard the strap line, “First Time, On Time”. Never more has this been true. We not only have our own reputations to protect but also those of our clients.

Another challenge faced by the supply chain service providers is how to maintain operational efficiencies, particularly when managing seasonal products with little or no historic demand data with which to use for inventory profiling. This coupled with dramatic fluctuations in throughput and multiple single item orders make it difficult for a warehouse manager to intelligently design the most cost effective operational picking sequences, receipts processes and storage profiles.

It is an imperative must for any solution deployed by our logistics partners in support of these dynamic and volatile operations to be able to analyse this data in real time, providing the analysis tools to the business to move from tactical and reactive decisions making based on “best guess-stimates”, to longer term strategic and operationally efficient planning.

e-Fulfilment is after all the art of managing our customers’ customers’ good will.

Author Simon Begnor
Proteus Software


For further information on Proteus Software Order Fulfilment Solutions contact Linda Rodway on 0121 717 7474 or email moreinfo@proteussoftware.com