Holste Says: The big challenge associated with ecommerce is that the daily/hourly high to low activity level can be extreme and is unpredictable. What Do You Say? Click Here to Send Us Your Comments Click Here to See Reader Feedback

While DCs are accustomed to processing medium to large orders consisting of multiple SKUs & quantities, ecommerce orders tend to be much smaller - usually single units of one or two SKUs. With an ecommerce site, the frequency of small orders can potentially be astronomical. DC operations most impacted include: picking, packaging, and returns. Consequently, companies are being forced to modify these critical operations to better accommodate this rapidly growing ecommerce market segment.

For many distributors batch order picking and sorting methods may lack the functionality and space to efficiently process small ecommerce orders. If that’s the case, the following includes several suggested adjustments that can improve e-fulfillment within the current operation:

• Providing special VAS services by adding two or more levels of mezzanines for picking, packaging, gift wrapping, returns and other back office tasks.

• Utilizing a combination of manual and automated picking technologies (RF Terminals, Pick-to-Light, Voice, and Product-to-Person methods)

• Achieving a same day order shipping cycle time for all ecommerce orders received prior to cut-off time – see “E-Commerce Business Objectives – Good Service, Fair Pricing, Timely Fulfillment”

• Running an efficient and customer centric Reverse Logistics operation
  
  

For companies who for whatever reasons are not able to make the required functional adjustment, outsourcing their ecommerce fulfillment business may prove to be the best alternative.

E-Commerce Picking Technologies

Because the majority of ecommerce orders are picked complete from one product location, there is no need to travel through multiple pick zones to complete those orders. With that in mind along with the need for speed and scalability, the best picking technologies include (but are not limited to) the following:

• RF system - the location and quantity for each product is displayed on the terminal screen. Wearable RF terminals are available to provide a more efficient RF picking operation.

• Voice system - voice commands guide the operator during picking.

• Pick/put-to-light system - location displays are illuminated to guide the operator through the picking process.

Comparing qualitative issues (see chart below) among these technologies will most likely show that a pick/put to light system provides the best solution, with the least risk. However, depending on the weight or importance of each criteria and your specific application, each of these technologies provides a viable solution for e-commerce picking operations.

Financially, there are trade-offs between technologies. A pick/put to light system may have a high initial investment cost, but lower annual labor costs. An RF terminal system has a medium to low initial investment cost, but higher annual labor costs. And, voice system investment and labor costs rank somewhere in the middle.

For more in-depth discussion and analysis of this increasingly important issue see – “Should E-Commerce Fulfillment and Regular Distribution Be Housed in the Same Distribution Center? Part 2”

Final Thoughts

Traditional batch order picking and sorting systems operate best in a predictable environment. The big challenge associated with ecommerce is that the daily/hourly high to low activity level can be extreme and is unpredictable. Therefore, requires a highly flexible and adaptable picking strategy, such as Product-to-Person, that can be easily and quickly ramped up or down. However, that said - there are no “one-size-fits-all” solutions.