Automated ASRS for Omnichannel Fulfillment
So, What Is Omnichannel Fulfillment?
Omnichannel, omni channel or even multichannel, fulfillment is basically when a retailer or manufacturer fulfills orders through multiple processes. Typically, this is done when a company is selling through multiple channels. A good example of this is e-commerce versus brick-and-mortar stores. If a person orders online, that order process looks quite different than orders that are shipped on a pallet to a store.
Even though the concept seems quite easy, processes have been routed in decades of brick-and-mortar type of distribution operations and shipping. Now that e-commerce is becoming a significant portion of any retail or manufactures business, organizations are left to define their omnichannel fulfillment strategy and determining if they should retrofit, start over, or continue to handle it separately. Today, there are multiple ways to handle fulfillment:
· Drop shipping from the manufacturer to end-user customer,
· Fulfillment from centralized distribution center,
· Contract through a third-party logistics (3PL), or fulfillment center,
· Ship from a retail store location,
· Orders are pulled from inventory at a retail location for local consumer pick-up (click and pick).
While not all of these are available or the perfect solution for everyone, each has pros and cons. Also, there are some best practices that you should know as you move forward with your omnichannel process.
Most All Businesses Require Some Type of Omnichannel Fulfillment Process
Whether your business serves B2C or B2B, chances are, you’re handling multiple selling channels. Thus, fulfillment can become quite challenging. Whether you’re drop shipping direct to customers on behalf of a retailer or sending out large pallets to a major retail distribution center, business today consists of multiple types of orders and different fulfillment methods. Not to mention retail has multiple ways of fulfilling an order—from the store floor to a regional fulfillment center. Even B2B companies are now experiencing an onslaught of e-commerce orders from their clients.
The days of ordering vast amounts of product and fulfilling at once are diminishing. And then the pandemic happened, and yes, everyone wants to ensure inventory. This means more storage capacities are needed, and a strategic plan for how inventory is stored for fulfillment. Thus, multiple orders mean various fulfillment strategies. At times, it may seem best to scratch an entire process and to start with a fresh approach. However, it doesn’t have to happen in this manner. There are cases when retrofitting a process for omnichannel fulfillment can be just as effective and save money.
Why Automated Omnichannel Fulfillment is an Investment for Today’s Business Model
ASRS for Omnichannel fulfillment offers an array of advantages to both retail and manufacturers. These include:
New revenue streams from various selling channels,
Customers get to shop the way he or she sees fit and thus, buyer satisfaction increases
Greater throughput depending on fulfillment strategy
Automated fulfillment can reduce the need for manual labor.
However, before one gets started with automated technology it’s good to understand the basics and what is needed. First, you’ll need a WMS that can handle omnichannel fulfillment and one that is multi-tenancy if needed. Since orders can and will possibly be picked by various fulfillment methods and locations, an organization should have a WMS that can determine in real-time the best shipping method based on customer location and if there are any preferences in shipping method—like overnight or same-day shipping.
Inventory must be kept up to date in real-time and that’s why a robust WMS is needed. To learn more on WMS, check out WAMAS.software from SSI SCHAEFER or ask to speak with an expert today.
Do Picking and Sortation Differ with Omnichannel?
The simple answer is yes. Pick and sortation do differ from brick-and-mortar processes to omnichannel fulfillment process. As mentioned earlier, when e-commerce was first introduced, and people were “trying it out” it may have been okay to manually fulfill the e-commerce orders and continue with an automated goods-to-person picking solution for brick-and-mortar stores.
However, the e-commerce trial period is over and it’s moving towards a least a quarter of all shopping patterns. In fact, the National Retail Federation (NRF) states that 15% of all purchases are made through e-commerce, which is down 4% from where it peaked during the pandemic. Although, the NRF also states that 50% of all retailers currently offer, or plan to offer, some type of omnichannel fulfillment.
Automated storage and retrieval solutions offer an array of various picking options. From items to cases, to complete pallets, these material handling systems can be quite complex or simplistic depending upon the picking process. In most omnichannel scenarios, picking is done in multiple ways, for eaches or individual items that are being picked and shipped directly to the consumer or to a store for pick-up. However, please note that SSI SCHAEFER typically recommends an automated solution for reducing labor. Although, there may be times where manual picking may be best if volumes are extremely low and there is no growth trajectory. Today, this continues to be the most expensive pick alternative. In B2B cases this may be doable, but it remains an expensive endeavor that one typically tries to avoid.
There are also complete pallets that are being built from cases or from totes that are being shipped directly to the store. Again, these systems can easily live in harmony together under one roof or multiple. However, updates need to be made in real-time so that inventory levels remain accurate for omnichannel fulfillment.
Automated sortation is also key with orders that have multiple line items. These systems can buffer items as they are being pulled for order fulfillment. For example, an e-commerce order may have four items. One item is a fast mover that is pulled from storage immediately. The other items are in various places. The sortation function allows the items to sort in sequence and provides buffering so that the items are sent to the picking station at once or batched as one order.
This optimizes picking and makes shipping easier and faster. This is true for all types of sorters as well. Overhead sortation like the SSI Carrier or loop sortation has this functionality. Sorters can be small for operations with a condensed footprint or extremely large depending on the need and the volume of SKUs and orders.
How to Get Started with Omnichannel Fulfillment?
If you are looking at a greenfield facility or just looking to retrofit your current existing processes, contact an SSI SCHAEFER omnichannel expert. Our team has decades of experience in retail and manufacturing, and SSI SCHAEFER knows the pain points and best practices globally. We’re happy to help and can do a complete system design or even consult when needed. We’re just a phone call or email away to get you started. SSI SCHAEFER has powered some of the world’s largest retailers and manufacturers' automated omnichannel fulfillment, and we can do yours too.