Omni-channel – A New Kind of Speed

Hytrol

12 years ago

Consumer expectation has always been the driving force of the supply chain. And with the ever-evolving world of e-commerce and the smartphone, that expectation has rapidly shifted. Consumers want their shopping experience to be seamless between stores and devices, and that’s where omni-channel fulfillment comes into play.

So, what is omni-channel? Macy’s President of Logistics and Operations, Peter Longo, put it simply. “Omni-channel is the complete integration of promotion, packaging, merchandising and pricing to create a unified experience, in-store and online.” Easier said than done, right? When most people think of this business model, they often assume they must incur huge operational and equipment costs. There is also the assumption that implementing these principles may create disruption throughout the facility due to the need to completely reconfigure the layout.

I’m not Amazon. How can this strategy work for me? There are several ways to incorporate omni-channel principles into your business without experiencing a substantial capital expense. Below are several options:

Gradual growth driven investment: Steadily incorporate omni-channel principles over a period of time-based on revenue.
Area reconfiguration: Use existing equipment to process orders more efficiently for e-commerce expansion.
Utilization of your current facility: Use current inventory for in-store and e-commerce needs.
Scalable conventional: Add on to current facility to accommodate multi-channel requirements.

Do I need a warehouse control system? There are many benefits of incorporating a warehouse control system (WCS) into your facility. A WCS synchronizes labor and equipment to increase productivity, which enables the quick decisions necessary to meet tight deadlines. It allows you to make adjustments to labor and wave management on the go, while building flexibility into your system to accommodate both store and e-commerce demands. Other benefits of a WCS include the ability to assign a UPC code to any of multiple orders, wave buffers to de-couple picking from packing and shipping, and the ability to deal with emergency or cut-off orders.

Additional considerations:

Speed

While the rules may have changed, speed is still king. In the past, shipping to individual stores and distribution centers required high throughput from the equipment and minimal touches to drive down costs. Distribution centers were viewed as a “necessary evil”. With omni-channel fulfillment, a new kind of speed is required. Cut-off times become crucial as distribution centers begin to ship individual items, which ultimately increases the number of orders flowing through the facility. The upside to this shift is that distribution centers have become sales generators.

Tricks of the Trade

With multi-channel fulfillment, the structure of order picking is altered to become more efficient. Placing multiple orders into one tote is faster for picking and more cost-effective for the total system. Shipping to a parcel facility becomes easier than ever by simply depositing all orders into a large container at the dock. Items can then be processed at the parcel facility, which means you’re moving more products out the door at a faster rate. Right angle densely packed sort points allow a maximum number of orders processed in a minimal footprint. Incorporating put-to-light walls is an efficient way to process more orders at once. This allows orders to be placed into groups and processed quickly. Dynamic pick locations allow for temporary fast movers to be assigned a high-velocity slot.