Organising a well-functioning warehouse for eCommerce constitutes a key aspect in the management of a successful online (or ecommerce) shop. Considering the year of 2020 with a global pandemic and shifts in consumer buying, it may prove to be even more significant than the shop.
Thanks to having a shop that has been designed in a good manner we acquire buyers, but only by executing the orders effectively do we retain customers.
Being the largest economy in GCC region and the youngest internet-connected population in the world, Saudi Arabia is being increasingly targeted by burgeoning eCommerce industry, which brings with it an urgent necessity for excellent warehousing solutions.
The Saudi Arabian government aims to increase the contribution of eCommerce to 80% of the retail sector by end of 2020, as the internet population is projected to grow to 73.45% in 2022. By the end of 2020, the eCommerce market in the country is expected to have grown to USD 8.35 billion, according to the Saudi Communication and Information Technology, with projections of it reaching USD 24 billion by 2026.
eCommerce is recognised as one of the pillars of Saudi Arabia's Vision 2030 under the National Transformation Program and the government aims to increase the contribution of modern trade and e-commerce to 80 percent in the retail sector by 2030. Also, the Saudi Arabian government is planning an investment of over US$ 100 billion in the development of logistics infrastructure to boost eCommerce growth in the region.
As a result of this eCommerce boom, we find consumers expecting faster delivery times and lower costs, making running warehouses and distribution centers even more challenging. Warehouses who are not looking ahead and embracing digitisation and future-proof systems run the risk of making themselves obsolete.
Warehouse managers must pay close attention to the significant changes that eCommerce is creating in the warehouse industry, and anticipate fulfillment strategies as they transform their warehouses.
How to implement efficient processes with the right technology and infrastructure:
Historically, warehouses and distribution centers functioned to process bulk orders, but eCommerce has changed that; now they are dealing with smaller orders (or even individual items) which requires a highly efficient picking strategy to decrease labour and sustain profitability.
Cluster-picking is an easy method to begin with if you want to make your warehouse suitable for eCommerce because it is a cost-efficient strategy that focuses on the picking of items instead of orders.
A WMS is also capable of prioritising item picking in cases where a set of orders needs to be prioritised over the others.
An organised warehouse is an efficient warehouse: it makes fundamental processes such as picking and replenishment more accurate, simpler, and quicker, ultimately fulfilling more orders in a shorter time. In eCommerce, where time is money, warehouse managers must realise the importance of slotting optimisation when it comes to preparing their warehouse for eCommerce.
What Is Warehouse Slotting? The process of identifying the most appropriate storage location for each product in your inventory.
Slotting optimisation allows warehouse workers to pick orders faster which helps to enable next-day or same-day delivery, which is no longer just a popular option in eCommerce, but a rising necessity.
Embracing the optimal eCommerce warehouse layout also ensures you are using your warehouse storage space effectively.
While it is possible to optimise warehouse slotting manually, this process requires the analysis of a great deal of data (at least a full year’s worth), including seasonality and projected inventory growth. Therefore, we recommend investing in an automated system to save your team valuable time for working on other important tasks.
Historically, reverse logistics was an optional extra, but competition has changed that in the eCommerce boom! Providing a hassle-free return experience has become crucial in earning customer satisfaction and retention, as well as maintaining brand trust on platforms like social media.
Returns processed using the warehouse management system give distributors a real-time view of their inventory. Damaged goods can be quarantined and dealt with promptly for repackaging or disposal, whilst reusable stock can quickly be identified and relocated for order picking.
Technological innovation is constantly changing, but for the better! Embracing it is one of the best ways to stay ahead of challenges in the eCommerce warehouse.
Some companies are still skeptical of investing in warehouse technology, as it can require a significant amount of capital, but when it comes to preparing your warehouse for eCommerce you don’t necessarily need Bezos’ credit card.
Your warehouse can be fitted with a custom solution that fits within your budget, allowing you the benefits with a high reward.
Consider how the use of tablets and other portable devices is now popular in warehouses, allowing connectivity among workers, no matter their location within the facility. With the wide array of warehouse technologies available today, there are many warehouse solutions that can be considered to add value to your operations.
A good WMS will help you to interface the new technology with your existing ones, optimise them, and still offer flexibility and scalability for future growth.
“With the increase in eCommerce and (omnichannel) fulfillment, many companies have realised that their existing system may fit their brick-and-mortar fulfillment environment, where the lowest level of picking is normally a case, but it’s a different set of WMS needs when you are doing many individual item picks for e-commerce.”- Dwight Klappich, Research Vice President for GartnerManhattan is a 12-time Best WMS winner in Gartner's Magic Quadrant
Clinging to a legacy warehouse management solution usually results in bottlenecks, tears, and delays in fulfilling a high-volume order. This is simply because old warehouse management solutions have limited capabilities, including the inability to use modern warehouse technologies and digitisations.
When preparing your warehouse infrastructure for eCommerce, one of the first and strongest recommendations is to upgrade to an advanced, flexible, powerful WMS system.
Modern warehouse management systems are equipped to integrate with modern technologies like mobile devices, dimensioners, machine learning, and automation.
Leveraging these new technologies - or knowing you can upscale to them when necessary without needing yet another WMS - will help you optimise warehouse processes and thus successfully tackle key challenges associated with e-commerce.
Allow us to be unoriginal and quote “Teamwork makes the dreamwork” - but the reality is that the phrase exists because it is true. Even the best system cannot operate without people (well… not yet, anyway!) so your team needs to evolve to support your evolution into the digital commerce space.
Managing a warehouse requires people skills, but also the ability to embrace new technologies, as well as actively seek them out. This is relevant for all teams nowadays in warehousing - the ability to adapt, engage, and advance to constantly maximise processes and profits, while dropping costs and unnecessary labour.
A good WMS partner will assist in training your team, keeping them updated with new technologies and advances, and need minimal adjustments to offer the most specific solutions possible.
As eCommerce expands massively over the next few years, warehouses and distribution centers must prepare to support the changing demands of consumers to ensure survival.
Are you feeling ready to make the leap to eCommerce?