As I write this, Christmas 2016 is only a few weeks away. And, as it has been for the last few years, shoppers are once again relying on e-commerce to buy and deliver gifts on time. That means a great demand on next-day delivery.
The pressure is mounting for more and more warehouses to have a next-day delivery service. The question for them is no longer: “Should we be starting a next-day delivery program?” The question is: “How do we set up an efficient next-day delivery program?”
(Courtesy: Bill Haslam at flickr.com)
Most if not all warehouses are using digital to manage their operations. Warehouse executives have become familiar with most of the software available that can help with this including Warehouse Management Systems (WMS), Warehouse Control Systems (WCS), and Warehouse Executive Systems (WES). How a warehouse uses the software can mean the difference between having or not having a successful next-day delivery service.
Many warehouse executives who have experienced the problem of initiating next-day delivery service say that it starts with nine steps that include:
1. Assessing your order history
2. Dynamic Order versus Wave Management
3. The proper software to use
4. An accurate inventory
5. Labor management
6. Storage
7. Picking
8. Replenishing Inventory
9. Assessing Packing and Shipping
Let’s attack each step one at a time.
Assessing Your Order History
Warehouse executives who have experienced the implementation of next-day delivery advise that you take at least two or three months to analyze your order history before deciding what kind of automation you should be introducing into your operation. This assessment should include such issues as how many lines are in orders, the cubic requirements for SKUs and order profiles, and growth of orders over time. Once you have completed a full assessment, then you can start to determine what software is best for your situation.
Dynamic Order Versus Wave Management
In order to have a successful next-day delivery program a warehouse must be flexible in how they release orders to the floor and integrate them into the picking process. What causes problems is that many Warehouse Management Systems (WMS) process orders in large groups or waves that have to be worked through the process from start to finish before it can account for new orders. In short, you need to find a way to drop new orders into the process. This leads into…
The Proper Software To Use
Order management systems or enterprise systems are set up to release orders to a WMS or WCS in large groups that creates a choke point in your ability to process new orders. There is a need for a “Dynamic Integration” between order management and WMS or WCS. After that, the warehouse operation needs to be flexible enough to drop new orders into the flow and work process.
Some software companies have created a solution called Warehouse Execution System (WES) that supports a continuous flow of orders and collects order data and analyzes it to create a level flow of picking, replenishment, packing, and other fulfillment activities. Many software companies who create WES note that their solution offers continuous flow, which takes new orders into account and makes them a part of the process.
An Accurate Inventory
Of course, knowing what is in your inventory is essential for any warehouse operation and is paramount in offering next-day delivery. WMS does a good job of providing a solution for this, but it needs to be supported by solid data collection. This may be a difficult task for warehouses that have thousands of SKUs, large pick areas to replenish, and seasonal or temporary employees to meet the labor needs. In this case, WMS with graphical aids can assist in ensuring accuracy. However, the labor force needs to be properly trained and be able to use barcode data collection. Training and system checks and balances are essential to assure inventory accuracy.
In Part II I will discuss Labor Management, Storage, Picking, Replenishing Inventory, and Assessing Packing and Shipping in creating a next-day delivery service.